Question
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
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