The payback period for evaluating capital investment projects emphasizes:
A) Liquidity.
B) Profitability.
C) Cost of capital.
D) Average net income divided by average investment.
E) Average after-tax cash inflow divided by average investment.

Question

The payback period for evaluating capital investment projects emphasizes: 
A) Liquidity.
B) Profitability.
C) Cost of capital.
D) Average net income divided by average investment.
E) Average after-tax cash inflow divided by average investment.

Quizplus · Accepted Answer

The payback period focuses on how quickly an investment can be recouped in terms of cash flow, emphasizing liquidity rather than profitability, cost of capital, or specific calculations involving net income or after-tax cash inflow.

The Payback Period for Evaluating Capital Investment Projects Emphasizes