Hi, need to submit a 2500 words essay on the topic Statistics & Quantitative Methods.
Thus, the payback period for Project A is 2.33 years. The Payback Period Method therefore is a technique used in appraising investments by actually trying to find out the Payback Period of a project. In this way, expected time required to recover the original investment can be calculated.
1.a.ii. Net Present Value Method. With the emergence of discounted cash flow techniques, it has become easy nowadays to implement the net present value method in investment appraisal. The net present value method is a method of ranking investment proposals using the net present value, which is equal to the present value of future net cash flows, discounted at the marginal cost of capital (Brigham, 1992).
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