To apply the payback rule,you calculate the amount of time it takes to pay back ________,called the payback period.
A) the all cash flows
B) all cash inflows
C) the incremental cash flows
D) the initial investment

Question

Quizplus · Accepted Answer

The payback period is calculated by dividing the initial investment by the annual cash inflows until the investment is fully paid back. Therefore, the correct answer is D, the initial investment.

To Apply the Payback Rule,you Calculate the Amount of Time