Which one of the following is correct concerning the rules related to project an

Question

Which one of the following is correct concerning the rules related to project analysis? a. The internal rate of return can lead to faulty decisions when two mutually exclusive projects are evaluated and when projects have nonconventional cash flows. b. The average accounting return considers both the market value and the discount rate of a project. c. The net present value method is only applicable if a project has conventional cash flows. d. The payback period method is easy to use and understand, and also considers cash flows beyond the payback period.

Explanation / Answer

The correct answer is option (B).

The average accounting return considers both the market value and the discount rate of a project.

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