Based strictly on the payback method,which project is preferred?

Question

Quizplus · Accepted Answer

The payback method favors projects with shorter payback periods, meaning the project that recovers its initial investment in a shorter amount of time is preferred. In this case, Project A has a payback period of 1.92 years, which is less than the payback period of Project B, which is 2.23 years. Therefore, based strictly on the payback method, Project A is the preferred choice.

Based Strictly on the Payback Method,which Project Is Preferred