A Drawback in Using the Payback Approach to Capital Budgeting

question 49

Multiple Choice

A drawback in using the payback approach to capital budgeting decisions is

• A)it doesn't account for the time value of money.
• B)it ignores cash flows beyond the payback period.
• C)it doesn't adjust for differences in the stream of cash flows.
• D)All of the above

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Definitions:

Evolutionary Theories

A set of propositions aimed at explaining how and why certain behaviors or physical traits have developed over time through the process of natural selection.

Cannon-Bard Theory

A theory of emotion that suggests emotions and bodily changes occur simultaneously rather than sequentially, with emotional experiences resulting from the brain's interpretation of bodily responses to stimuli.

James-Lange Theory

A psychological theory suggesting that emotions result from physiological reactions to events.

Autonomic Arousal

The activation or response of the autonomic nervous system, controlling involuntary body functions and often linked to stress and emotions.