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What is one disadvantage of NPV as a capital budget method? It can be misleading if inputs like cash flow turn out to be wrong.

What is one disadvantage of NPV as a capital budget method?

  • It can be misleading if inputs like cash flow turn out to be wrong.
  • It does not deliver an overall picture of the gain or loss of implementing a project.
  • It is rarely used, so there is disagreement as to what an adequate NPV is.
  • It cannot be used to compare investments with different upfront costs.

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