Payback Period

Written by Jerry Ratzlaff on . Posted in Manufacturing Engineering

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

 

Tags: Equations for Manufacturing