One of the advantages given for the NPV method is that it looks at the whole project life cycle – is this in comparison to the payback method, which only looks at the income for a shorter period of time, and therefore NPV may look at the return up to the project termination?
Yes that is right, the normal practice is to look at the NPV for the whole life of the project. Thia can be quite a long time period for big capital project. In practice because of the compound nature of discounted cash flow then benefits a long time in the future have little present value.