Match the following concepts to their description below:

Group of answer choices:

A. Compounding

B. Payback period method

C. Discounting

D. Net present value

E. Internal rate of return method

Match:

1. Capital budgeting method that discounts future cash flows to their present value at the expected rate of return, and compares that to the initial investment.

2. Process of reinvesting interest earned to generate additional earnings over time

3. Capital budgeting method that determines profitability or growth potential of an investment, expressed as a percentage, at the point where NPV equals zero.

4. Process that determines the present value of a single payment or stream of payments to be received.

5. Captial budgeting method that does not assign a value to a business opportunity using time-value measurement tools