The NPV Method Is the Preferred Method Over IRR for Selecting

question 121

Multiple Choice

The NPV method is the preferred method over IRR for selecting projects because ________.

• A) its use leads to shareholder value maximization
• B) it accounts for the time value of money
• C) it assumes that cash flows are reinvested at the internal rate of return
• D) it gives a project ranking consistent with that of IRR

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Definitions:

Split-phase Motors

A type of single-phase induction motor that uses a secondary start winding or auxiliary winding offset by electrical degrees to create a phase shift, helping to start the motor.

Pulsating Magnetic Field

A magnetic field that varies in amplitude over time in a periodic manner.

Rotating

The action or process of turning around a center or an axis; a fundamental movement in various mechanical and electrical devices.

Fixed

Pertains to an electronic component or value that remains constant and unchanged throughout its operation or use.