An Investment Project Is Most Likely to Be Accepted by the Payback

Multiple Choice

An investment project is most likely to be accepted by the payback period rule and not accepted by the NPV rule if the project has:

A) a large initial investment with moderate positive cash flows over a very long period of time.
B) a very large negative cash flow at the termination of the project.
C) most of the cash flow at the beginning of the project.
D) All projects approved by the payback period rule will be accepted by the NPV rule.
E) The payback period rule and the NPV rule cannot be used to evaluate the same type of projects.