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adelina 88 [10]
2 years ago
15

Which of the following is true regarding the payback method: 18 8 01:02:53 a. When a company is 'cash poor', a project with a sh

ort payback period but a low rate of return may be preferable to a project with a long payback period and a high rate of return b. The computation of the payback period is the project's initial investment divided by the present value of its net cash flows. c. A payback period of 35 means a company will earn 35 times its initial investment, d. The payback period increases as the cost of capital increases
Business
1 answer:
Rasek [7]2 years ago
6 0

Answer:

b. The computation of the payback period is the project's initial investment divided by the present value of its net cash flows.

Explanation:

Payback calculates the amount of time it takes to recover the amount invested in a project from it cumulative cash flows

Payback period = Amount invested / cash flow

Discounted payback calculates the amount of time it takes to recover the amount invested in a project from it cumulative discounted cash flows

payback period decreases as cost of capital increases

A payback period of 35 means a company will recover the amount invested in a project in 35 years

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Explanation:

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4 0
3 years ago
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Trevor’s peers were surprised when he received a promotion and suddenly became their supervisor. They thought he was rather unre
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Answer: (D) Poor leader-member relations

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3 years ago
California Adventures issues 5,000 shares of 8%, $100 par value preferred stock at the beginning of 2020. All remaining shares a
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Answer:

See below.

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Hope that helps.

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