Which of the Following Investment Rules May Not Use All

question 42

Multiple Choice

Which of the following investment rules may not use all possible cash flows in its calculations?

• A) NPV
• B) IRR
• C) Payback
• D) All of the above

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Definitions:

Inventory Period

The average time it takes for inventory to be sold and replaced over a period, a key component of efficiency in supply chain management.

Accounts Payable Period

The average duration it takes for a company to pay off its suppliers after receiving goods or services.

Accounts Receivable Period

The mean duration that a company requires to receive payments from credit sales, reflecting the effectiveness of its policies on credit and collections.

Operating Cycle

The period of time between the acquisition of inventory by a company and the receipt of cash from accounts receivable from the sale of that inventory.