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Discussion Response U7R28070EDRead discussion post below, and write a PHD level response.  Be sure to include at least two APA-formatted citation (in-text plus full reference). The citation may be from course textbooks, assigned readings, or an outside source. Your initial post must be a minimum of 200 words in length Payback Method is a method to evaluate the feasibility of an investment by determining how long it would take to recover the initial investment, disregarding the time value of money (Zelman, McCue, Glick, & Thomas, 2014). The payback method ignores cash movements following the payback period. The strengths of the payback method consist of the following: meek to calculate and easily understood. Weaknesses of the payback method include: it gives an answer in years, not dollars, it neglects cash flows after the payback period, and it does not report for the time value of money.Net Present Value is the difference between the initial amount paid for an investment and the future cash inflows the investment brings in, adjusted for the cost of capital (Zelman, McCue, Glick, & Thomas, 2014). The variance among the initial amount paid for a deal and its related future cash flows that have been adjusted by the cost of capital gives us the net present value. A positive net present value shows that the expected earnings produced by a project or venture surpasses the expected costs. A venture with a positive NPV will be a lucrative one and one with a negative NPV will result in a net loss (Shrieves, & Wachowicz, 2001).The internal r

ate of return (IRR) on an investment can be defined and interpreted several ways. (Zelman, McCue, Glick, & Thomas, 2014). The amount of return on an venture that makes the net present value equal to $0, once all cash flows have been reduced at the same rate equals the IRR. The higher a project’s internal rate of return, the more liklely the corporation is willing to undertake the project. IRR lets executives easily rank developments by their general rate of revenue rather than their net present values, and the venture with the highest IRR is favored. Reference: Zelman, W., McCue, M, Glick N., and Thomas M. Financial Management of Health Care Organizations: An Introduction to Fundamental Tools, Concepts and Applications, 2014Shrieves, R. E., & Wachowicz Jr, J. M. (2001). FREE CASH FLOW (FCF), ECONOMIC VALUE ADDED (EVA™), AND NET PRESENT VALUE (NPV):. A RECONCILIATION OF VARIATIONS OF DISCOUNTED-CASH-FLOW (DCF) VALUATION. The engineering economist, 46(1), 33-52. Answer Preview…………….Response to Discussion PostNet Present Value (NPV) and Internal Return of Return (IRR) are both valuable tools for used by organizations to determine the viability of projects regarding their financial benefits. As you noted in your post, the utilization of the NPV for selecting a project is dependent on the positive values obtained from the calculation while that of the IRR is dependent on the general rate of revenue. An additional dimension to the use of these financial management tools is that ………….APA 265 words
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