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The chief practical merit of simple payback is that it

  • A.accounts correctly for the whole project life
  • B.measures the return the investment earns
  • C.allows for inflation in the energy price
  • D.needs no discount rate to be agreed

Answer: D

Arguing about the right discount rate can delay a decision longer than the measure would take to pay back, and payback sidesteps it. That convenience is why it survives as a screening tool alongside the more rigorous measures.

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