All of the following are advantages of the NPV-payback approach to risk analysis except
A)it is easy and inexpensive to apply
B)it considers a project's liquidity
C)it explicitly considers the variability of a project's return
D)it is consistent with the notion that risk increases with futurity

Question

Quizplus · Accepted Answer

The NPV-payback approach does not explicitly consider the variability of a project's return, which is a measure of risk. It focuses more on liquidity and the timing of cash flows rather than the variability of returns.

All of the Following Are Advantages of the NPV-Payback Approach