Payback Analysis: Formula & Example


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question 1 of 3

Which of the following is the BEST explanation of payback analysis?

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1. Which one of the following is NOT a mathematical term in the payback formula?

2. Which one the following is the correct payback formula?

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About This Quiz & Worksheet

This quiz and corresponding worksheet will help you gauge your knowledge of payback analysis. The quiz covers several topics, including the best explanation of payback analysis and the mathematical terms in the payback formula.

Quiz & Worksheet Goals

Use this printable worksheet and quiz to review:

  • Definition of payback analysis
  • Mathematical terms in the payback formula
  • Correct payback formula identification
  • Payback period in a given problem
  • Payback period of each property

Skills Practiced

This worksheet and quiz will let you practice the following skills:

  • Interpreting information - verify you can read information regarding payback analysis and interpret it correctly
  • Reading comprehension - ensure that you draw the most important information from the related management lesson
  • Problem solving - use acquired knowledge to solve a payback period problem

Additional Learning

To learn more, review the lesson Payback Analysis: Formula & Example, which will help you:

  • Understand a payback analysis
  • Identify how to find the break-even point of an investment
  • Explain the formula used to find the payback period
  • Describe when an investment is a worthy one
  • Appreciate the role of the net annual cash flow in a company