The following are disadvantages of using the payback rule EXCEPT the rule:
A)ignores all cash flow after the cutoff date.
B)does not use the time value of money.
C)is easy to calculate and use.
D)does not have the value additivity property.

Question

Quizplus · Accepted Answer

The statement "is easy to calculate and use" is actually an advantage of the payback rule, not a disadvantage. The other three options are valid disadvantages of using the payback rule.

The Following Are Disadvantages of Using the Payback Rule EXCEPT