Podcast
Play an AI-generated podcast conversation about this lesson
Questions and Answers
Which of the following statements accurately describes the payback period?
Which of the following statements accurately describes the payback period?
- It is the time it takes for an investment to generate enough cash flows to cover all expenses
- It is the time it takes for an investment to generate a return on investment
- It is the time it takes for an investment to generate a profit
- It is the time it takes for an investment to recover the initial cost (correct)
Why is the payback period important for businesses?
Why is the payback period important for businesses?
- It is a legal requirement for businesses
- It guarantees a high return on investment for businesses
- It ensures businesses achieve long-term financial stability
- It helps businesses make informed choices about investments (correct)
What does the payback period indicate about an investment?
What does the payback period indicate about an investment?
- The liquidity of the investment
- The risk associated with the investment
- The time it takes to generate a return on investment (correct)
- The profitability of the investment
Flashcards are hidden until you start studying
