Evaluate the following five statements about capital budgeting. I. In comparing mutually exclusive projects with unequal lives, you should always choose the project with the highest NPV under the standard NPV technique. II. The replacement chain technique is a method that uses the annuity concept to value a projects cash flows for mutually exclusive project with unequal lives. III. An incremental cash flow represents the change in the firms total cash flow that occurs as a direct result of taking a project. IV. When calculating the cash flows for a project, you should include interest payments. V. Mutually exclusive projects sometimes have long and different lives, which makes applying the replacement chain method difficult because the shortest common life between two projects could be very large.

Group of answer choices

I is false; II, III, IV and V are true.

I and IV are false; II, III, and V are true.

All five statements are true.

II and IV are false; I, III, and V are true.

I ,II and IV are false; III, and V are true.