3. The instructor said the Internal Rate of Return ("IRR") and Payback Period ("PP") capital budgeting evaluation methods were not strong enough to be the primary method for decision-making. What weakness does the IRR method have? What weakness does the PP method have?

A. IRR is usually the best method except when comparing independent projects; PP is better than the NPV method but is inferior to the IRR method.

B. IRR may not provide good guidance when comparing mutually-exclusive projects or when future expected free cash flows are a mixture of positive and negative cash flows; PP ignores the time value of money investment principles.

C. IRR ignores the time value of money investment principles; PP may not provide good guidance when comparing mutually-exclusive projects or when future expected free cash flows are a mixture of positive and negative cash flows.

D. There is no option D.