11 Payback Period Part 1

This video introduces the payback period, a key investment appraisal method. It's defined as the time required to recover your initial investment based purely on cash flows, without any discounting involved. The video demonstrates this calculation with a detailed example of a three-year project, showing how to determine the exact point at which the initial capital is reclaimed. Learn how to calculate it to the nearest month, such as 2 years and 4 months in the given scenario, assuming linear cash flows for precise calculation. The discussion emphasizes that this method does not incorporate discounting. Subscribe to @AxiomTutoringCourses for more finance tutorials.