Question

    An investment costs ₹50,000 and generates ₹15,000

    annually for 5 years. What is the Payback Period?
    A 2.5 years Correct Answer Incorrect Answer
    B 3 years Correct Answer Incorrect Answer
    C 3.33 years Correct Answer Incorrect Answer
    D 4 years Correct Answer Incorrect Answer

    Solution

    Payback Period = Cost of Investment / Annual Cash Flow = ₹50,000 / ₹15,000 ≈ 3.33 years

    Practice Next