About this document
Lecture+4+Investment+Appraisal+Mehtods+11 12 by Mahajan Ajay is a document available to read on EtoBox.
Payback period years to recover initial investment Example: Year 0 1 2 3 4 Payback Project A (1000) 400 400 400 400 2. Years Project B (1000) 600 400 200 nil 2 years payback period Advantages: Easy concept to understand Easy to calculate (provided future cash flows have been calculated) Uses cash, not accounting profit Takes risk into account (in the sense that earlier cash flows are more certain) Does not indicate whether the project increase the value of a company.
- Author
- Mahajan Ajay
- Language
- EN