Question

which of the following techniques does not take into account the time value of money?​

Answer 1

Answer:

Payback period method does not take into account the time value of money.

I hope you understand it

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Answer 2

The strategy of ARR does not take the time worth of money into the account.

Explanation:

• The Average Rate of Return (ARR) method does not consider the time value of money while taking the evaluations for capital investments.  

• The concept of the time value of money states that money accessible now is worth more than money available in the future. To put it another way, two investments may produce different annual revenue streams. ARR does not assign a higher value to the project that produces profits sooner, which may be reinvested to earn more money, if one project returns more income in the early years while the other project returns revenue in the later years.