Multiple Choice
Why may the IRR criterion lead to an incorrect decision when applied to mutually exclusive projects?
A) The NPVs of mutually exclusive projects cross over at some discount rate.
B) Cash flows cannot be discounted when considering mutually exclusive projects.
C) Mutually exclusive projects produce negative IRR values.
D) Mutually exclusive projects have multiple IRRs.
Correct Answer:
Verified
Correct Answer:
Verified
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