Question

Which of the following statements regarding cash flow patterns (for time periods 0, 1, 2, 3, and 4) is correct? O Select one: O A. The sequence of -$100, $50, $40, $60, and $50 is a nonconventional cash flow pattern B. The sequence of $50, $50, $70, $60, and -$150 may have more than one internal rate of return O C. The sequence of +$100,-$1,100, and $1,600 is a conventional cash flow pattern O D. All of the above are correct

Answer 1

Option B
The sequence of -$50, $50, $70, $60, and -$150 may have more than one internal rate of return
If we have more than one sign changes, then we have more than one internal rate of return

Option A is incorrect because it is a conventional cash flow pattern as there is only initial outflow and then series of inflows
Option C is incorrect because it is a nonconventional cash flow pattern as outflow does not occur initially