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Q16. What is the major disadvantage in using the Payback Period method for capital budgeting decisions? O Select one: O a. It oversimplifies the calculations

Q16.

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What is the major disadvantage in using the Payback Period method for capital budgeting decisions? O Select one: O a. It oversimplifies the calculations and thus the results that come out are unreliable. b. It is less accurate than other methods in estimating when the capital is returned to the shareholders. c. It is not an guaranteed indicator of the optimal wealth level of the company as it places its focus on short term comfort factors such as the return of capital outlay as a proxy. O d. It is based on linear approximation between cash flow points which is an assumption that may not be true

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