If the present value payback period is less than the life of the project,one may conclude that:

Question

Quizplus · Accepted Answer

The present value payback period is the length of time it takes for the discounted cash flows of a project to equal its initial investment. If the present value payback period is less than the life of the project, it means the project is generating positive cash flows and recovering its initial investment in a shorter time than the project's life. This indicates that the project's net present value is positive, as its discounted cash inflows are greater than its initial investment. Therefore, choice D is the best choice.

If the Present Value Payback Period Is Less Than the Life