The payback period is the amount of time required for the firm to dispose of a replaced asset.

Name: The payback period is the amount of time required for the firm to dispose of a replaced asset.
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The payback period is actually the amount of time required for the cash inflows from a project to equal the initial investment. It is commonly used as a measure of a project's profitability and risk.

The Payback Period Is the Amount of Time Required for the Firm