The discounted payback method calculates the payback period and then discounts the payback period at the opportunity cost of capital.

Name: The discounted payback method calculates the payback period and then discounts the payback period at the opportunity cost of capital.
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The discounted payback method calculates the time required to recoup the initial investment in present value terms by discounting the cash flows at the opportunity cost of capital, not by discounting the payback period itself.

The Discounted Payback Method Calculates the Payback Period and Then