Irr method has advantages because it is easy to understand

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Reference no: EM131962351

1. IRR method has advantages because it is easy to understand, close to NPV, and useful when you have limited funds to allocate.

a. True

b. False

2. The disadvantages of Payback Rule are no consideration on time value, arbitrary cutoff, ignoring cash flow after cutoff, and strong bias against long-term projects.

a. True

b. False

3. The buyer of a bond put option stands to make a profit if changes in market interest rates cause the bond price to fall below the exercise price.

True

False

Reference no: EM131962351

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