Q1

a) The internal rate of return method of analysis may lead to incorrect decisions when comparing mutually exclusive projects.

True

False

b)

A disadvantage with the average accounting return is the difficulty in obtaining necessary information to do computation.

True

False

c)

The payback period and discounted payback are biased in favour of liquid investments.

True

False

d)

the internal rate of return method of analysis should not be used for comparing two independent projects of differing sizes.

True

False

e)

NPV and IRR can lead to different decisions in situations where project cash flow are conventional.

True

False