Which Capital Investment Evaluation Technique Is Described by the Following

question 162

Multiple Choice

Which capital investment evaluation technique is described by the following characteristics? (1) Easy to understand; (2) Biased towards liquidity; (3) Requires an arbitrary cutoff point; (4) Ignores the time
Value of money.

• A) NPV
• B) IRR
• C) Profitability index
• D) Payback period
• E) Discounted payback