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Acceptance Rule of Payback Period or PBP
By using PBP method a company such will accept all those ventures whose payback period is less than to set via the management and will refuse all those ventures whose PBP is more than that set via the management. Otherwise, PBP may be gauged against the term of the loan whether case the PBP method will provide a high ranking to all those ventures paying back before the term of the loan and the highest ranking will be specified to those projects with shortest PBP. Conversely, in assessing the viability of a venture it is too significant to see that venture brings returns earlier, another things being equal.
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