If a Company Is in the Situation of Having Unlimited

question 19

Multiple Choice

If a company is in the situation of having unlimited capital funds, the best decision rule, considering only financial factors, is for the company to invest in all projects in which:

• A) The payback period is short.
• B) The accounting (book) rate of return (ARR) is greater than its current return on invested capital (ROI).
• C) The net present value (NPV) is greater than the cost of capital.
• D) The internal rate of return (IRR) is greater than zero.
• E) The NPV is greater than zero.