When Choosing Between Projects,an Alternative to Comparing Their IRRs Is

question 21

Multiple Choice

When choosing between projects,an alternative to comparing their IRRs is:

• A)to compute the incremental IRR,which tells us the discount rate at which it becomes profitable to switch from one project to the other.
• B)to compute the incremental payback period,which tells us the number of years during which it becomes profitable to switch from one project to the other.
• C)to compute the incremental NPV,which tells us the discount rate at which it becomes profitable to switch from one project to the other.
• D)There is no alternative selection criterion to comparing IRRs.

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Definitions:

Force Field Analysis

A technique used to identify and analyze the forces that either aid or hinder the achievement of a certain goal or change.

Driving Forces

Factors or motivations that compel someone to move towards a goal or change.

Status Quo

The existing state of affairs, particularly regarding social or political issues.

Personal Changes

Alterations in one's life or behavior resulting from reflection, decision-making, or external influences.