The payback period yardstick is more important to gauge capital projects for "traditional businesses" than projects for "high tech" businesses.

Question

Quizplus · Accepted Answer

The payback period yardstick, which measures how quickly an investment pays back its initial cost, is often less relevant for high tech businesses due to their rapid pace of innovation and change, making long-term viability and growth potential more critical factors to consider. Traditional businesses may rely more on the payback period for its simplicity and focus on short-term financial recovery.

The Payback Period Yardstick Is More Important to Gauge Capital