Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

The net present value method is the preferred method for capital-budgeting decisions. Therefore, managers will always use it. Do you agree? Explain. A. No. DCF

"The net present value method is the preferred method for capital-budgeting decisions. Therefore, managers will always use it." Do you agree? Explain.

A. No. DCF is the best and only practical way to make capital-budgeting decisions.

B. Yes. If managers are evaluated on the internal rate of return, they will use the NPV method for capital-budgeting decisions. In addition, managers will choose investments that maximize the internal rate of return.

C. No. If managers are evaluated on the accrual accounting rate of return, they may not use the NPV method for capital-budgeting decisions. Instead, managers will choose investments that maximize the accrual accounting rate of return.

D. Yes. If managers are evaluated on the accrual accounting rate of return, they will always use the NPV method for capital-budgeting decisions

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Funding And Financing Transport Infrastructure

Authors: Athena Roumboutsos, Hans Voordijk, Aristeidis Pantelias

1st Edition

0367735792, 9780367735791

More Books

Students also viewed these Accounting questions