52.2k views
1 vote
Which of the following is a technique for evaluating capital projects that is particularly useful when firms face time constraints in repaying investors?

1 Answer

0 votes

Answer:

A. Payback

Step-by-step explanation:

Payback, otherwise referred to as payback period is one of the techniques used for project appraisal. It is the period a project or investment is able to generate enough cash flow to cover the amount invested in it.

The payback tests the speed with which a project can payback the initial capital outlay of a project. Where a firm is facing time constraint in the payment of debtors, payback technique is the best project appraisal method to employ.

User Rosie
by
8.3k points
Welcome to QAmmunity.org, where you can ask questions and receive answers from other members of our community.

9.4m questions

12.2m answers

Categories