The payback period is the time taken to recover the initial investment. So a £1m investment that will make a profit of £200,000 a year has a payback period of five years.
What is a payback period?
How do you compute the Cash Payback period?
What are the Payback Period for both projects?
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The payback period (without discounting the future cash flows) is exactly 1 year.
DISCOUNTED PAYBACK PERIOD RULE - An investment decision rule in which cash flows are discounted at an i...
DISCOUNTING - To sell at a reduced value; the difference between face value and cash value. Some compan...
Discounted Payback Period Rule definition :
An investment decision rule in which cash flows are discounted at an interest rate and then one determines how long it takes for the sum of the discounted cash flows to equal the initial investment.
Definition: Payback period is an investment appraisal technique that looks at the amount of time it takes an investment project to recover the initial money that was laid out.
Payback Period The time taken to recover the investment on a project.
Payback Period. The length of time it takes to recover the initial cost of a project, without regard to the time value of money.
Penny Stock. Low-priced, often speculative issues usually selling at less than $1 per share.
payback period - The number of years required for an organization to recapture an initial investment. This may apply to an entire business operation or an individual project.
Payback Period. The length of time it will take for an investor to recoup his cash outlay. Often used as a quick way to analyze an investment, usually in personal property. For example, a new machine will cost you $10,000.
Payback period: A capital budgeting performance measure that estimates the period of time required to recoup the initial investment in the asset.
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Payback Period: Payback period is the length of time that it takes to receive cash flow and other economic benefits from an investment that is exactly equal to the initial cash investment.
The payback period is a measure of how long it takes for a project or investment to repay any initial outlay.
A PEG payback period of six years, for example, means that it would take six years for an investor to recoup the price paid now for $1 of corporate earnings (the P/E ratio).
payback period The amount of time needed to break even on an investment. paydown The repayment of part of an outstanding loan balance. payee An individual who receives a form of payment (i.e. cash, check, money order, or promissory note).
Break-even time Related: Premium payback period. Breaking the syndicate Terminating an agreement among underwriters, specifically the investment banking group assembled to underwrite the issue of a security.
Payback Period
How long it will take to earn back the money invested in a project.
Allocating Corporate Capital Fairly
by John L. Mariotti
The appetite of organizations for capital is insatiable.
The longer the payback period, the greater the risk. The metric presumes that the business has stopped making interest payments (because interest is added back).
It also fails to reveal what happens after the payback period. For example, some investments may payback rapidly, but have little residual cash flow after the payback period.
In contrast to an NPV analysis, which provides the overall value of an project, a discounted payback period gives the number of years it takes to break even from undertaking the initial expenditure.
This is called the Payback period. Thus the title benefits the organisations cashflows only in month 11. This is a long time especially as the final cashflows are received in month 12 (publication + 6).
It is biased in favor of projects that have a short payback period;
The measurement provided is in years, rather than a dollar amount or a rate of return, making this method difficult to use when choosing between investments; ...
The payback method is also called the payback period. It is the measure of time it will take to recoup, in the form of cash inflows from operations, the initial dollars of outlay. It is not a profitability measure.
Required compensation for the new business owners.
Capital expenditures anticipated in the near term.
Payback period on the business buyer's down payment.
Debt service coverage ratio expected by the lenders.
The price of an options contract; also, in futures trading, the amount the futures price exceeds the price of the spot commodity. Related: inverted market premium payback period Also called break-even time, ...
trading, the amount the futures price exceeds the price of the spot commodity. Related: inverted market premium payback period. Also called break-even time, the time it takes to recover the premium per share of a
convertible security.
Feasibility study - Evaluation of a contemplated project or course of action, according to pre-established criteria. (such net present value, internal rate of return, and payback period) to determine if the proposal meets management requirements.
Soft Loan - A loan with generous terms such as lower than usual or no interest, and/or a long payback period.
The credit score of the borrower, the LTV, the loan size and payback period, whether the mortgage is a first mortgage or a junior mortgage, and numerous other factors all affect the mortgage rate for a particular loan.
For straight equity, price higher than that of the last sale or inside market. Related: inverted market premium payback period. Also called break-even time, the time it takes to recover the premium per share of a convertible security.
Related: inverted market premium payback period. Also called break-even time, the time it takes to recover the premium per share of a convertible security. Premium bond A bond that is selling for more than its par value.
It may be a certain interest rate, a positive NPV or a maximum payback period.
Income and expenditure account: the equivalent to Profit and Loss (P&L) Accounts in nonprofit organizations such as clubs, societies and charities.
 See also: Payback, Net present value, Expense, Time Value, Values
  
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