Which of the capital budgeting criteria is size-dependent, i.e., reflects the project's scale or size? A....

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Option	Defination	Correct/Incorrect	Reason
A.	The internal rate of return is a measure of an investment’s expected future rate of return.	Incorrect	It does not take into account the size of the project
B.	Profitability index, also known as profit investment ratio and value investment ratio, is the ratio of payoff to investment of a proposed project.	Incorrect	It takes profitability into account
C.	NPV = Present Value of cash inflow - Present Value of cash outflow	Correct	It takes the size of the project into consideration
D.	The payback period refers to the amount of time it takes to recover the cost of an investment.	Incorrect	It takes years into consideration.

Answer 2

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