The Internal Rate of Return Is Unreliable as an Indicator

question 8

Multiple Choice

The internal rate of return is unreliable as an indicator of whether or not an investment should be accepted given which one of the following?

• A)One of the time periods within the investment period has a cash flow equal to zero.
• B)The initial cash flow is negative.
• C)The investment has cash inflows that occur after the required payback period.
• D)The investment is mutually exclusive with another investment under consideration.
• E)The cash flows are conventional.

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Definitions:

Zone

A zone is a specific area or region designated for a particular purpose or characterized by a particular feature.

Proximal Development

A concept in psychology referring to the zone of development where a learner can perform a task under adult guidance or with peer collaboration that could not be achieved alone.

Imitate

To copy or mimic the actions, behavior, or physical appearance of someone or something else, often as a method of learning or entertainment.

Body Mass Index

A measure used to assess a person's body weight relative to their height, indicating if they are underweight, normal weight, overweight, or obese.