Capital Budgeting

Discounted Payback Period

Definition

What is Discounted Payback Period?

The time required for discounted cash inflows to recover the initial investment.

Example in practice

Discounting makes the payback period longer than the undiscounted version.

Keep learning

Present value of expected cash inflows minus present value of expected cash outflows.

The discount rate that makes a project's net present value equal to zero.

A return measure that uses specified financing and reinvestment rates rather than assuming reinvestment at the IRR.

A yearly publication containing financial statements, management discussion, governance information, and other disclosures.

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