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Which of the following statements on investment criteria are incorrect ? a) Average Accounting return (AAR) is flawed because it relies on past accounting data
Which of the following statements on investment criteria are incorrect ?
a) Average Accounting return (AAR) is flawed because it relies on past accounting data
b) Payback is the length of time until the sum of the investment's cash flows equal the initial outlay
c) Profitability Index (PI) is the ratio of the PV of expected cash flows to the investment cost
d) Projects with a PI >1 are usually accepted
e) IRR and PI can be used to rank mutually exclusive projects
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