Which of the Following Statements Is CORRECT

question 85

Multiple Choice

Which of the following statements is CORRECT?

• A) The IRR method appeals to some managers because it gives an estimate of the rate of return on projects rather than a dollar amount,which the NPV method provides.
• B) The discounted payback method eliminates all of the problems associated with the payback method.
• C) When evaluating independent projects,the NPV and IRR methods often yield conflicting results regarding a project's acceptability.
• D) To find the MIRR,we discount the TV at the IRR.
• E) A project's NPV profile must intersect the X-axis at the project's WACC.

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Definitions:

Financial Reporting

The process of producing statements that disclose an organization's financial status to management, investors, and government entities.

GAAP

Generally Accepted Accounting Principles (GAAP) are a set of rules and standards used in the United States for financial reporting, providing guidelines on how financial statements should be prepared and disclosed.

IRS

The Internal Revenue Service, a U.S. government agency responsible for tax collection and enforcement of tax laws.

Installation Costs

Expenses associated with setting up equipment or assets so that they are ready to be used in operations.