Question

What is the drawback of pay back period as a metric of energy economics?

Answer 1

______✨ HEY MATE ✨______

➡️It does not consider time value of money.

✌️ I THINK IT HELPED YOU ✌️

Answer 2

Pay back period is based on determining the number of years required for the invested capital to be recovered from net cash flows. 1. A rapid pay back may be prime criterion for judging an investment when financial resources are available to the investor only for a short period of time.