Which of the Following Statements Is CORRECT

question 82

Multiple Choice

Which of the following statements is CORRECT?

• A) For a project to have more than one IRR,then both IRRs must be greater than the WACC.
• B) If two projects are mutually exclusive,then they are likely to have multiple IRRs.
• C) If a project is independent,then it cannot have multiple IRRs.
• D) Multiple IRRs can occur only if the signs of the cash flows change more than once.
• E) If a project has two IRRs,then the smaller one is the one that is most relevant,and it should be accepted and relied upon.

---

Definitions:

Journal Entries

The recording of financial transactions in a company's ledger, detailing the accounts affected and the amounts debited or credited.

Authorized

Refers to the official approval or permission for something, often used in the context of authorized shares in a corporation.

Outstanding

Describes something that is currently due or has not been settled or resolved, often referring to payments or checks.

Treasury Stock

Shares once issued and then retrieved by the originating company, lowering the volume of shares trading on the open market.