Which of the Following Is a Reason That Makes NPV

question 114

Multiple Choice

Which of the following is a reason that makes NPV a better approach to capital budgeting on a purely theoretical basis?

• A) It measures the benefits relative to the relative amount invested.
• B) The reinvestment rate assumed by this method is reasonable.
• C) Financial decision makers are inclined to higher rates of return.
• D) Interest rates are expressed as annual rates of return.

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