Glossary

Payback Period

The payback period (sometimes called “payback” or “breakeven period”) is the length of time required to recover the initial costs of an investment. The payback period ignores the time value of money (TVM), unlike other methods of capital budgeting such as net present value (NPV), internal rate of return (IRR) and discounted cash flow.

Related Terms

  • Payback

  • Breakeven Period

 

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