A Reason That a Small Firm Would Not Use a Discounted

Multiple Choice

A reason that a small firm would not use a discounted cash flow technique in evaluating capital investments would be that

A) the accounting rate of return is better for a small firm.
B) liquidity is less of an issue for a small company.
C) small firms invest more in short-term assets than do large companies.
D) nonfinancial issues may be more important for a small firm.