Changes

==Payout==

==Payout==

[[file:key-economic-parameters_fig2.png|left|thumb|{{figure number|2}}Undiscounted and discounted cumulative net cash flow streams for example multiwell extension project.]]

[[file:key-economic-parameters_fig2.png|thumb|{{figure number|2}}Undiscounted and discounted cumulative net cash flow streams for example multiwell extension project.]]

The ''payout'' is the length of time required for the venture to generate income sufficient to equal capital investment and expenses (see [[:file:key-economic-parameters_fig2.png|Figure 2]]). This measure is of greater importance to small investors, who are concerned about liquidity and risk exposure. It can be calculated using constant purchasing power dollars. In cases where a loan payment is required, dollars of the day should be used. Its major drawbacks are that it doesn't consider cash flows ''after'' payout occurs, nor does it address any aspect of investment performance. Although payout implicitly touches on financial risk and exposure (which translates to “when do I get my money back?!”), it does not address chance of success in any way.

The ''payout'' is the length of time required for the venture to generate income sufficient to equal capital investment and expenses (see [[:file:key-economic-parameters_fig2.png|Figure 2]]). This measure is of greater importance to small investors, who are concerned about liquidity and risk exposure. It can be calculated using constant purchasing power dollars. In cases where a loan payment is required, dollars of the day should be used. Its major drawbacks are that it doesn't consider cash flows ''after'' payout occurs, nor does it address any aspect of investment performance. Although payout implicitly touches on financial risk and exposure (which translates to “when do I get my money back?!”), it does not address chance of success in any way.