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Managers have several different methods from which to choose when evaluating long-term investments. Which method disregards the time value of money as a factor?
Suggested Answer: A
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33 comments · newest first
JA
Janey
10 months ago
Yup, Payback is all about quick returns, not time.
AR
Arleen
10 months ago
Wait, are we sure about that? Seems off to me.
GE
Gerri
10 months ago
It's definitely the Payback method!
BL
Blondell
10 months ago
Totally agree, Payback ignores time value.
IO
Iola
10 months ago
I thought Annuity tables did too, but I guess not!
GE
Geraldo
11 months ago
I definitely recall that Net Present Value and Internal Rate of Return both factor in the time value of money, so it must be Payback.
DA
Daren
11 months ago
I’m a bit confused. I thought Annuity tables also didn’t consider time value, but maybe that’s just for certain calculations?
CA
Carlee
11 months ago
I remember practicing questions where Payback was mentioned as not considering the time value of money. It seems right to me.
LO
Loren
11 months ago
I think the method that disregards the time value of money is the Payback method, but I'm not entirely sure.
JU
Junita
12 months ago
Payback is the answer. It's the simplest method and the only one that doesn't factor in the time value of money.
EA
Earleen
12 months ago
Okay, I've got this. The payback method is the one that doesn't take the time value of money into account when evaluating long-term investments.
JA
Janna
12 months ago
I'm a bit confused on this one. I know the time value of money is an important factor, so I'm not sure which method would disregard that.
GL
Glenn
1 year ago
Payback! That's the one that just looks at how long it takes to recoup the initial investment, without considering the time value of money.
OC
Ocie
1 year ago
Hmm, this seems like a tricky one. I'll need to think carefully about the different investment evaluation methods and which one disregards the time value of money.
GE
Gerald
1 year ago
Payback method? Is this a trick question or something? That's like trying to win the lottery without buying a ticket. Come on, let's get serious here.
SH
Shenika
1 year ago
Wait, are we actually discussing finance methods that don't consider the time value of money? That's like trying to fly a plane without fuel. Good luck with that one, guys.
JA
James
1 year ago
Internal rate of return, baby! That's the way to go. Forget about the time value of money, we're living in the moment here. Who needs to plan for the future, anyway?
CE
Ceola
1 year ago
Annuity tables? Pfft, what is this, the Stone Age? Net present value is where it's at, people. That's the way to go if you want to make some serious dough.
OL
Olen
1 year ago
Annuity tables may be outdated, but they can still be useful in certain situations.
OL
Olen
1 year ago
I agree, net present value is the way to go for evaluating long-term investments.
LO
Loreta
1 year ago
Net present value is definitely the way to go. Annuity tables are so outdated.
LU
Luis
1 year ago
I agree with Eveline, Payback method does not take into account the time value of money.
EV
Eveline
1 year ago
I think the answer is A) Payback because it does not consider the time value of money.
RA
Rachael
1 year ago
I disagree, I believe the answer is B) Annuity tables.
CO
Corinne
1 year ago
I think the answer is A) Payback.
LA
Lanie
1 year ago
Payback method? Really? That's like trying to buy a house without considering interest rates. Come on, that's just basic finance 101.
MI
Minna
1 year ago
Exactly, it's important to consider the opportunity cost of tying up funds in a project.
JU
Junita
1 year ago
C) Net present value takes into account the time value of money, making it a more comprehensive method.
TE
Teddy
1 year ago
I agree, the payback method is not the most effective way to evaluate long-term investments.
EL
Eladia
1 year ago
D) Internal rate of return
JU
Julene
1 year ago
C) Net present value
BE
Belen
1 year ago
B) Annuity tables
LA
Lai
1 year ago
A) Payback