METHOD COMPARISON Compare methods of capital investment analysis below to begin your evaluation of the three capital investment proposals Alpha, Beta, and Gamma. You decide to compare four methods: the average rate of return, cash payback period, net present value, and internal rate of return methods. Average Rate of Return Method Cash Payback Method Net Present Value Method Internal Rate of Return Method Considers the time value of money Does not consider the time value of money Easy to compute Not as easy to compute Directly considers expected cash flows Directly considers timing of expected cash flows Assumes cash flows can be reinvested at minimum desired rate of return Can be used to rank proposals even if project lives are not the same