Notes page 24 -- the example said the conflicts are due to 1) project size, 2) cash flow timing ah...
Why the answer is C?? I don't understand yah~~~~ Thanks!!!!
The underlying cause of ranking conflicts between the net present value (NPV)
and internal rate of return (IRR) methods is the underlying assumption related
to the:
Your answer: B was incorrect. The correct answer was C) reinvestment
rate.
The IRR method assumes all future cash flows can be
reinvested at the IRR. This may not be feasible because the IRR is not based on
market rates. The NPV method uses the weighted average cost of capital (WACC) as
the appropriate discount rate. | 
发表于 2009-5-10 06:14
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