Payback Period - The time it takes to recover the cost of the Initial Investment

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  • Published date: July 13, 2021
    • Daman, Daman and Diu, India [ Ad Id - 135534 | Ad Views - 13 ]

The Payback Period is the time period required to recover the cost of a project. In other words, it is the length of time needed to know when a project's cumulated cash flow will be able to pay back for its initial investment. Also, it is a question of risk where the shorter the money is invested in a risky project, the less risky the investment is. But the main advantage of this ratio is that it is easy to calculate and also can be easily understood by anybody.

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