Final answer:
The statement is false; the discounted payback method involves discounting future cash flows, not the payback period itself.
Step-by-step explanation:
The statement that the discounted payback method calculates the payback period and then discounts the payback period at the opportunity cost of capital is false. Instead, the discounted payback method involves applying a discount rate to each of the future cash flows to determine their present value and then calculating how long it takes for the sum of the discounted cash flows to pay back the initial investment.
Present discounted value is a concept used to assess investments, policies, or any scenario where costs are incurred now for benefits received in the future. By discounting future cash flows, one can compare the value of investments that offer returns at different times. For example, businesses evaluating physical capital investments or governments considering infrastructure projects use present discounted value to weigh the immediate costs against the future benefits.