Use the Following Two Statements to Answer This Question

question 1

Multiple Choice

Use the following two statements to answer this question:
I.The NPV assumes that all cash flows are reinvested at the firm's cost of capital.
II.The IRR assumes that all cash flows are reinvested at the project's economic rate of return.

• A)I and II are correct.
• B)I and II are incorrect.
• C)I is correct, II is incorrect.
• D)I is incorrect, II is correct.