ABSTRACT
This is probably the most frequently used technique for assessing the financial viability of projects. It regards projects which repay their capital cost most quickly as being best. For example, if a cafe´ purchases a new cooker for £1,000 and makes an average of £0.50 profit on each meal, the cooker will be paid for after £1,000/£0.50 = 2,000 meals. If the cafe´ sells 40 meals a day, the full price of the cooker is paid back after 2,000/40 = 50 days.
