A capital investment project has an initial investment followed by constant annual returns.How is the payback period calculated?
A、Initial investment / annual profit
B、Initial investment / annual net cash inflow
C、(Initial investment - residual value) / annual profit
D、(Initial investment - residual value) / annual net cash inflow
A、Initial investment / annual profit
B、Initial investment / annual net cash inflow
C、(Initial investment - residual value) / annual profit
D、(Initial investment - residual value) / annual net cash inflow
【参考答案及解析】
The payback period is the time that is required for the total of the cash inflows of a capital investment project to equal the total of the cash outflows, ie initial investment / annual net cash inflow.
The payback period is the time that is required for the total of the cash inflows of a capital investment project to equal the total of the cash outflows, ie initial investment / annual net cash inflow.