Question 31 (2.5 points)

Which of the statements below is FALSE?

Question 31 options:

	We calculate the equivalent annual annuity by taking the NPV of the project and find the annuity stream that equates to the NPV, using the appropriate discount rate for the project and life of the project.
	In dealing with mutually exclusive projects of unequal lives, we can compute the EAA for the NPV of the project over the life of the project.
	One of the advantages of NPV over other decision models is that we can select the appropriate discount rate for each individual project and still compare the resulting NPVs across different projects.
	By using the EAA approach for mutually exclusive projects, we overcome all potential problems.