The Underlying Cause of Conflicts in Ranking for Projects by Internal

Multiple Choice

The underlying cause of conflicts in ranking for projects by internal rate of return and net present value methods is ________.

A) the reinvestment rate assumption regarding intermediate cash flows
B) that neither method explicitly considers the time value of money
C) the assumption made by the IRR method that cash inflows are spread equally throughout the timeline
D) that NPV approach favors small projects with high returns