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Which (if any) of the following disadvantages to using the Payback Period method cannot be mitigated away by using the method properly? Multiple Choice An
Which (if any) of the following disadvantages to using the Payback Period method cannot be mitigated away by using the method properly?
Multiple Choice
An arbitrary cutoff point can be used.
It ignores cash flows beyond the cutoff date (assuming a cutoff date is set).
All of the disadvantages can be mitigated away when the payback period method is used properly.
It is biased against long-term projects.
It ignores the time value of money.
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