Calculate and interpret payback, average rate of return and net present value.

Key terms

• quantitative analysis: quantitative analysis is a Business concept used to analyse Calculate and interpret payback, average rate of return and net present value.. A strong answer defines it, applies it to a named business context and explains the commercial consequence.
• Assessing investment options: Assessing investment options should be judged by linking it to objectives such as profit, survival, growth, competitiveness, efficiency or customer satisfaction.
• payback: payback affects stakeholders differently, so analysis should consider owners, managers, employees, customers, suppliers or investors before reaching a judgement.
• net present value: net present value has a financial impact when it changes costs, revenue, profit, cash flow, investment return, break-even output or ratio interpretation.

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