# 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