Which of the Following Is Always True Regarding the NPV

question 124

Multiple Choice

Which of the following is always true regarding the NPV decision model?

• A) If a project is found to be acceptable under the NPV approach, it would also be acceptable under the internal rate of return (IRR) approach.
• B) The NPV and the IRR approaches will always rank two projects in the same order of preference.
• C) If a project is found to be acceptable under the NPV approach, it would also be acceptable under the payback approach.
• D) If a project is found to be acceptable under the NPV approach, it would also be acceptable under the book (accounting) rate of return approach.
• E) If a project is rejected under the NPV approach, it would also be rejected under the payback approach.

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