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Finance Post #5

Describe how the payback period is calculated and describe the information this measure provides about a sequence of cash flows. What is the payback criterion…

Describe how the payback period is calculated and describe the information this measure provides about a sequence of cash flows. What is the payback criterion decision rule? What are the problems associated with using the payback period as a means of evaluating cash flows? What are the advantages of using the payback period to evaluate cash flows?

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