You are considering a project with conventional cash flows and the following characteristics:

Internal rate of return 11.63%

Profitability ration 1.04

Net present value $987

Payback period 2.98 years

Which of the following statements is correct given this information?

I. The discount rate used in computing the net present value was less than 11.63 percent.

II. The discounted payback period must be less than 2.98 years.

III. The discount rate used in the computation of the profitability ratio was 11.63 percent.

IV. This project should be accepted as the internal rate of return exceeds the required return.

A. I and II only

B. III and IV only

C. I, II, and IV only

D. II, III, and IV only

E. I, II, III, and IV

Tell me why III is wrong