What is the payback method? What are its main strengths and weaknesses?

Q: What are the benefits and Flaws of Payback Screening?

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: What happens if the payback period is within the acceptable range?

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: Why is partitioning an internal rate of return important?

A: Introduction: There are two cash flow components which can form the portioning of internal rate of…

Q: What exactly are ESOPs? What are some of its benefits and drawbacks?

A: Introduction: ESOP: Employee stock ownership plan is retirement plans for employees of the company…

Q: What are the shortcomings of the internal rate of return criterion?

A: Solution- Internal Rate of Return (IRR)-      The Internal Rate of return (IRR) is that the discount…

Q: What does it mean for markets to be efficient? What are the differences in the degree of efficiency,…

A: The markets are considered to be efficient if the information related to various aspects that create…

Q: What is the internal rate of return?

A: Internal rate of return is the discount rate at which present value of cash inflows equals outflows…

Q: Describe the method of Payback Screening?

A: Answer: The company has several investment opportunities. It is vital that you opt for the right…

Q: What three flaws does the regular payback method have? Does thediscounted payback method correct all…

A: The amount received in various years are totally given a similar weight, the time value of cash is…

Q: What are the appealing qualities of Payback Screening?

A: The payback method is the simplest way of checking the viability of the project. The payback method…

Q: What three flaws does the regular payback have? Does the discounted payback correctall of these…

A: Three flaws of payback period: 1. Time value of money concept is ignored by the payback period. 2.…

Q: What is the significance of finding the internal rate of return?

A: IRR helps to check the viability of the project. If IRR is more than Kc than Project seems to be…

Q: What are the shortcomings of the payback period criterion? Which of these shortcomings are accounted…

A: Payback method is a manner of evaluating capital projects which computes the time taken by the cash…

Q: How is the payback period determined?

A:

Q: What is the discounted-payback method?

A: Payback period states the number of years that is taken by the project to recover the investment of…

Q: What serious drawbacks do the much-used payback method of investmentscreening have?

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: What are the Flaws of Payback Screening?

A: The payback period alludes to what extent it takes for a speculator to hit breakeven to recoup the…

Q: What is the project's discounted payback?

A: Investment appraisal techniques are used while investing in any project. These techniques tell us…

Q: what are the sssumptions about market efficiency?

A: The theory that states that all the information available in the capital market is reflected in the…

Q: What does the usage of technical analysis mean for the theory of market efficiency?

A: Market efficiency:- Market is said to be ‘efficient’ only if the price of every security in the…

Q: List the advantages and disadvantages of the payback method.

A: Payback method is a capital budgeting method which helps to evaluate an investment based on the time…

Q: Which project has no rate of return?

A: Answer: IRR is a measure in capital budgeting used to measure the value of the predicted…

Q: What is the payback screening?

A: Payback method: Payback period is the expected time period which is required to recover the cost of…

Q: Explain the payback period model and its two significant weaknesses. How does the discounted payback…

A: The payback period one of  the method of capital budgeting. It shows the required time taken to…

Q: If the APT is to be a useful theory, the number of systematic factors in the economy must be small.…

A: APT (Arbitrage Pricing Theory) Alternative multi-factor assets pricing theory helps in analyzing the…

Q: What are the differences between bottom-up and top-down approaches to security valuation? What are…

A: A top-down method to security evaluation starts with an examination of the worldwide and national…

Q: What is the conventional-payback method?

A: Conventional Payback Method

Q: Why aren't economic incentives as complex as we think?

A: Generally, an incentive means something that motivates a person to do a task/job/goal/etc.…

Q: what are the assumptions about market efficiency ?

A: Market efficiency refers to the market situation where stock prices reflect all available &…

Q: what is Political cost hypothesis ?

A: The financial statement will be prepared by the company to know the financial position of the…

Q: What is the meaning of Resource Market?

A: In business terms, anything which acts as input and contributes to the production process refers to…

Q: What is financial leverage?

A: Capital Structure:   It refers to the combination of debt and equity that constitutes the finances…

Q: What is market Value added? What is economic value added? What is the difference between what each…

A: Market value added is the amount of wealth that the company is able to create for its stakeholders.…

Q: What are the benefits and drawbacks of FIFO?

A: Introduction: First-in-First-Out:  In First-in-First-Out method, the costs of the initially…

Q: What is return on investment?

A: Return on investment  is a financial ratio which is measured as net income divided by the cost of…

Q: what are the limitations of the Comparative advantage theory?

A: Solution- Comparative Advantage Theory-          The term comparative advantage is most frequently…

Q: What is market value?

A: Market value is the competitive price at which an asset will sell in the market. It is the highest…

Q: costs and benefits of a too-big-to-fail

A: Too-Big-To-Fail Policy: Too-big-to-fail policy means saving a firm or industry whose failure can…

Q: What is meant by the term payback period?

A: The Payback Period helps to determine the extent of time required to recoup the initial cash outlay…

Q: What are practical weaknesses of NPO?

A: Organizations are described as business units which are established by the individuals, or group of…

Q: What is a “required rate of return”? Why is it called the “cost ofmoney” or the “price of money”?

A: The required rate of return can be calculated by two methods, 1) Gordan's growth model  Gordan's…

Q: What are the weaknesses of the payback method?

A: Payback period is the amount of time required for firm to recover its initial investment in projects…

Q: What are the two main drawbacks of the payback method?

A: Payback period is the method in capital budgeting which refers to the time needed to recoup the…

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.