Which of the following statements is FALSE?

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Part 1

A.

If you are unsure of your cost of capital estimate, it is important to determine how sensitive your analysis is to errors in this estimate.

B.

The IRR investment rule will identify the correct decision in many, but not all, situations.

C.

The simplest, though least accurate, investment rule is the NPV investment rule.

D.By setting the NPV equal to zero and solving for

r,

we find the IRR.