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1. True or False. When we use the Rate of Return Method in evaluating more than one alternative, we cannot compare the IRR of

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Answer #1

Answer :-

Here the answer is true

when we use the rate of return method in evaluating more than one alternative we cannot compare the IRR of mutually exclusive alternatives for IRR of the differences between mutually exclusive alternatives against those of alternatives

Explanation :-

IRR strategy is a technique is a limited incomes. The IRR is that markdown rate which likens speculation expense with the current estimation of inflows got after a timeframe

The inner pace of return is to be dictated by trail and mistake strategy so in assessing the fundamentally unrelated proposition this technique neglects to choose the most gainful task which is steady with the targets of boost of investors riches

The aftereffect of this strategy might be conflicting contrast with NPV technique if the activities vary in their (a)Expected lives (b) Investment (c) timing of money inflows

Thus,

when we use the rate of return method in evaluating more than one alternative we cannot compare the IRR of mutually exclusive alternatives for IRR of the differences between mutually exclusive alternatives against those of alternatives is true

Thank you

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