The expected amount of time to recover the initial amount of an investment is called the: Multiple Choice Amortization period. Payback period. Interest period. Budgeting period. Discounted cash flow period.

Payback Period

Explanation:

Payback period refers to the length of  time by which the initial  cost of an investment is expected to be recovered or the break even point of which an investment expects to recoup the amount used up in an initial cost of  investment.

A  good payback period is one with the shortest Payback, time while longer payback periods are not desired for business investments.

To calculate Payback period, we use

amount of the investment / annual cash flow = Payback period.

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