Payback Period

Payback period, abbreviated as PP, is the time in which the initial investment is expected to recover through the cash inflows generated by the investment.

 

Payback Period Formula

\(\large{ PP = \frac{ II }{ CI }  }\)

Where:

\(\large{ PP }\) = payback period

\(\large{ CI }\) = cash inflows

\(\large{ II }\) = initial invertment