The topic of capital budgeting is important because Multiple Choice the amount involved is often large money has a time value the returns from the investment are guaranteed all of the above are correct answers The biggest drawback of the IRR method is that Multiple Choice the IRR is always lower than the cost of capital it disregards the time value of money it always results in the "accept the project" decision it "assumes" that in subsequent years the cash inflows are reinvested in the project at the same internal rat Multiple Choice The PVI is computed by dividing the total present value of the cash inflows by the present value of the cash outflows. The PVI should be used to evaluate two or more projects whose initial investments differ. The higher the PVI, the better. A PVI value can be either positive or negative