Which One of the Following Statements Would Generally Be Considered

question 66

Multiple Choice

 Which one of the following statements would generally be considered as accurate given independent projects with conventional cash flows?

• A) The internal rate of return decision may contradict the net present value decision. 
• B) Business practice dictates that independent projects should have three distinct accept indicators before a project is actually implemented. 
• C) The payback decision rule could override the net present value decision rule should cash availability be limited. 
• D) The profitability index rule cannot be applied in this situation. 
• E) The projects cannot be accepted unless the average accounting return decision ruling is positive. 

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Definitions:

Building Contractor

A professional or company responsible for overseeing the construction process, including the coordination of labor, materials, and equipment.

Operating Cash Flow

The cash flow stemming from a company's usual business processes.

Marginal Tax Rate

The proportion of your earnings that is taxed according to the tax bracket(s) for which you are eligible.

Straight-Line Depreciation

A method of calculating the depreciation of an asset that allocates an equal amount of depreciation each year over the asset's useful life.