Which of the Following Statements Is CORRECT

question 40

Multiple Choice

Which of the following statements is CORRECT?

• A) The MIRR and NPV decision criteria can never conflict.
• B) The IRR method can never be subject to the multiple IRR problem,while the MIRR method can be.
• C) One reason some people prefer the MIRR to the regular IRR is that the MIRR is based on a generally more reasonable reinvestment rate assumption.
• D) The higher the WACC,the shorter the discounted payback period.
• E) The MIRR method assumes that cash flows are reinvested at the crossover rate.

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Definitions:

Extra Funds

Additional money available beyond what is necessary for regular expenses, which can be saved or invested.

Input Costs

Expenses that are incurred in order to produce goods or services.

Beverages

Liquid drinks, which can be alcoholic or non-alcoholic, consumed for refreshment or pleasure.

Appetizers

Small dishes served before the main meal to stimulate the appetite.