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Discounted payback method?
A discounted payback method is a formula that is used to calculate how long to recoup investments based on the discounted cash flows of the investment. It is a variation of payback period or the time it takes to recover a project investment given the discounted cash flow it has.
What is the difference between payback and discounted payback?
Simple payback method do not care about the time-value of money principle while discounted payback period do take care of this principle in calculation.
Advantages and disadvantage of project method?
Advantage and disadvantage of project method
What are the weaknesses of the payback method?
the payback method ... is a method to evaluate the project in capital budgeting ... or simply in a long term dicision making for the entity .and because it is a long term in nature ..... the risk is high ... by evaluatining methods ... we try to reduce the uncertinity ... one of the methods ...is payback method . the disadvantage of the payback method is ...it does not concern with the time value of money theory ....the second one is ...it ignore the incash flow and the outcash flow of the project , after the payback period .
Advantage and disadvantage of collective opinion method?
The method is simple and easy to be use
What is the advantage and disadvantage oven drying method?
The advantage of oven drying method is that all the trays get equal heat and therefore the drying is uniform. The disadvantage is that the dehydrator has limited capacity.
Why is the NPV method superior to the Payback method?
How is the method superior to the payback method
Why is the NPV method superior to payback method?
How is the method superior to the payback method
What are advantage and disadvantage of shaduf system?
DISADVANTAGE : 1)- Irrigates less area . ADVANTAGE : 1)- Not much expensive to use this method .
Is it true that One advantage of the payback method for evaluating potential investments is that it provides information about a project's liquidity and risk?
true
What is the advantage and disadvantage of error detection method in data communication?
what are the merits and demerits of data communication
What are the disadvantages of the discounted payback period?
It's not a direct measure of a project's contribution to stockholder's wealth. You may reject project's that should be accepted when using the NPV analysis (best method used for determining whether or not a project is accepted in Capital Budgeting). Discounted Payback Period AdvantagesConsiders the time value of money Considers the riskiness of the project's cash flows (through the cost of capital) Disadvantages No concrete decision criteria that indicate whether the investment increases the firm's value Requires an estimate of the cost of capital in order to calculate the payback Ignores cash flows beyond the discounted payback periodYounes Aitouazdi: University of Houston Downtown
