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​When Choosing Between Two Mutually Exclusive Projects for Which NPV

question 150

True/False

​When choosing between two mutually exclusive projects for which NPV and IRR give different results , the final decision should be based on NPV and not IRR.


Definitions:

Selling Price

The amount of money charged for a product or service, determined by various factors including cost, demand, and market conditions.

Convertible Bonds

Bonds that can be converted into a predetermined number of the issuing company's shares, at the holder's discretion, typically at certain times during their life.

Stock Price

The current market price per share at which a company's stock can be bought or sold.

Bond Interest

The periodic payment made to bondholders as a return on their investment, typically expressed as a percentage of the bond's face value.

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