What Is the Limitation of Using the Net Present Value

question 12

Multiple Choice

What is the limitation of using the net present value for evaluating capital investment alternatives?

• A) Ignores the time value of money
• B) Does not consider cash flows
• C) Cannot be used to compare projects of different size
• D) All of the above are limitations of the net present value method.

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Definitions:

Non-Canadian Ship

A vessel that is registered under the flag of a country other than Canada, subject to the maritime laws of its flag state.

Canadian Coastal Trade

The transport of goods or passengers between two points within Canada by sea, subject to specific regulations and protections.

Shipworkers' Trade Union

An organization that represents the interests and rights of workers in the shipping or maritime industry.

Labour Relations Board

A regulatory body that oversees and enforces labor laws related to the rights of employers and employees, including union activities and collective bargaining.