The payback period is:
A) the net present value of all cash flows (benefits and costs) generated by a project.
B) any cost savings associated with a project, such as savings from reduction in staff, equipment rental fees, and outsourcing fees.
C) any capital investment required to buy equipment, software, or office space.
D) the number of years required to recover the initial cost of an investment.

Question

Quizplus · Accepted Answer

The payback period is the number of years required to recover the initial cost of an investment. It is calculated by dividing the initial cost of the investment by the expected annual cash inflows from the project.

The Payback Period Is