Question

This capital budgeting method allows lower management to make smaller, everyday financial decisions effectively.

Multiple choice question.

Average accounting return


Payback method


Internal rate of return


Net present value

Answer 1

The capital budgeting method that allows lower management to make smaller, everyday financial decisions effectively is the **Payback method**. This method focuses on how quickly an investment can recoup its initial costs, making it easier for lower management to evaluate routine investment decisions without delving into complex calculations.