A disadvantage of the payback statistic is that:
A)it does not reflect the time value of money.
B)it does not give an indication of the project's riskiness.
C)it does not consider cash flows beyond the payback period.
D)All of the options are disadvantages of payback.

Question

Quizplus · Accepted Answer

All of the options listed are disadvantages of payback. The payback statistic does not take into account the time value of money, the riskiness of the project or cash flows beyond the payback period.

A Disadvantage of the Payback Statistic Is That