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Which of the Following Is an Advantage of the Internal

Question 30

Multiple Choice

Which of the following is an advantage of the internal rate of return method?​


A) It takes into account cash flows occurring only till the time the initial investment is completely paid back.
B) It does not use present value concepts in valuing cash flows occurring in different periods because this concept can give incorrect results.
C) It ranks proposals based upon the cash flows over their complete useful life, even if the project lives are not the same.
D) ​It assumes the cash received from a proposal can be reinvested at the minimum desired rate of return.

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