The NPV Rule Is Preferred to the Discounted Payback Period

question 90

Multiple Choice

The NPV rule is preferred to the discounted payback period as a project evaluation criterion because the discounted payback period rule ignores:
I.The initial cost
II.The timing of cash flows prior to the discounted payback period
III.Any cash flows beyond the discounted payback period

• A)III only
• B)I and II only
• C)I and III only
• D)II and III only

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Definitions:

Experimental Task

A task designed and used within a controlled experiment to investigate hypotheses or measure outcomes.

Risk

The possibility of loss, injury, or other adverse or unwelcome circumstance; a chance or situation involving such a possibility.

Replications

The process of repeating research or experiments to verify results and ensure reliability across different contexts or conditions.

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