Which of the Following Statements Is CORRECT

question 83

Multiple Choice

Which of the following statements is CORRECT?

• A) One defect of the IRR method versus the NPV is that the IRR does not take account of the time value of money.
• B) One defect of the IRR method versus the NPV is that the IRR does not take account of the cost of capital.
• C) One defect of the IRR method versus the NPV is that the IRR values a dollar received today the same as a dollar that will not be received until sometime in the future.
• D) One defect of the IRR method versus the NPV is that the IRR does not take proper account of differences in the sizes of projects.
• E) One defect of the IRR method versus the NPV is that the IRR does not take account of cash flows over a project's full life.

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Definitions:

Undisclosed Principal

A person, in a transaction conducted by an agent, whose existence and identity are unknown to the third party.

Wholesale Auto Auctions

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Car Purchasing Partnership

An agreement between individuals or entities to jointly purchase a car, often to benefit from bulk buying conditions or shared use.

Duty

A moral or legal obligation; a responsibility or task that one is required or expected to perform.