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All of the following are weaknesses of the payback period: _________

a. it uses cash flows, not income,
b. it is easy to use.
c. it ignores all cash flows after the payback period.
d. it ignores the time value of money.

User Emcanes
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Answer:

c. it ignores all cash flows after the payback period.

d. it ignores the time value of money.

Step-by-step explanation:

As the name suggest, the payback period is the period that shows the time period in which the investment money could be paid back

Like we can take an example

Year 0 -$50,000

Year 1 $10,000

Year 2 $10,000

Year 3 $10,000

Year 4 $10,000

Year 5 $10,000

In this, the $50,000 would be paid back in 5 years

Now the weakness is this that it would ignored the cash flows and the times value of money

User Kgalic
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