What is a weakness of residual income?

• A.

  It encourages managers to make investment decisions that are more consistent with the interests of the company as a whole.

• B.

  It does not take cost of capital into consideration.

• C.

  It can be misleading when comparing divisions of different sizes.

• D.

  It routinely results in managers rejecting investment opportunities that would be advantageous to the company as a whole.