The length of time required for an investment's discounted cash flows to equal its initial cost is the:
A) Net present value.
B) Internal rate of return.
C) Payback period.
D) Profitability index.
E) Discounted payback period.

Question

Quizplus · Accepted Answer

The discounted payback period is the length of time required for an investment's discounted cash flows to equal its initial cost. This method takes into account the time value of money by discounting the cash flows at a particular rate before calculating the payback period.

The Length of Time Required for an Investment's Discounted Cash