Which of the Following Statements Is FALSE

question 7

Multiple Choice

Which of the following statements is FALSE?

• A)The incremental IRR investment rule applies the IRR rule to the difference between the cash flows of the two mutually exclusive alternatives.
• B)When a manager must choose among mutually exclusive investments,the NPV rule provides a straightforward answer.
• C)The likelihood of multiple IRRs is greater with the regular IRR rule than with the incremental IRR rule.
• D)Problems can arise using the IRR method when the mutually exclusive investments have differences in scale.

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Definitions:

Direct Foreign Investment

Investment made by a company or individual in one country in business interests in another country, in the form of either establishing business operations or acquiring business assets.

Technological Knowledge

The information and understanding related to the practical application of tools, machines, materials, and processes used to solve problems or invent new products.

World's Income

The total income generated by all individuals and entities across the globe, often used in comparisons of wealth and economic performance between countries.

Real Outputs

Refers to the actual goods and services produced by an economy, as measured without inflation.