Payback period method, finance, Other Engineering

Non-discounted cash flow method,

Payback period method
In this method, time value of money is not considered. It takes into account the number of years required to recover the initial investment of a project (Harold Bierman, Seymour Smidt, 2006).
Accept Reject Rule:
Accept the project with lowest payback period.
Reject the project with highest payback period.
Merits:
1. Simple and easy to calculate
2. Less costly to use
3. Less time consuming
De-merits:
1. Time value of money is completely ignored.
2. Does not consider the cash flow generated after payback period.
Posted Date: 2/6/2012 10:36:27 PM | Location : United States







Related Discussions:- Payback period method, finance, Assignment Help, Ask Question on Payback period method, finance, Get Answer, Expert's Help, Payback period method, finance Discussions

Write discussion on Payback period method, finance
Your posts are moderated
Related Questions
Inspection of casting           Visual inspection         Inspection for dimensional accuracy.            Sound test            Pressure test          Impact te

bit reversed process 10 point dft


What are the importance of engineering thermodynamics

PRESSURE RELIEF VALVE The pressure relief valve shown in the figure. controls the oil pressure at the pre-set value demanded by the system. The valve is normally integral with

Choked Nozzle Considering the formula for thrust under "choked" nozzle conditions: Thrust =(P-P 0 )A + WV j /g     Where: P = Pressure P = Ambien

Q.   What is crystal imperfection? Briefly discuss all types of point defects in crystals. Ans. The various type of crystal imperfection are as follows: (1)   Point de

In laser beam welding coalescence is produced by the heat obtained from the application of a concentrated coherent light beam impining upon the surface to be joined .   It con


Capacitive transducers Consider a capacitor consisting of two parallel conducting plates with an insulator in between. Its capictance is C = ε 0 ε r  A/d where ε