Which of the following is not a benefit associated with using the NPV technique in capital budgeting?
A)The NPV technique takes into account the time value of money.
B)The NPV technique always selects projects that maximise shareholders' wealth.
C)The NPV technique provides evaluation in percentage format,making it easier to interpret.
D)The NPV technique considers all cash flows expected to be generated by the project and hence uses all available information.

Question

Quizplus · Accepted Answer

The NPV (Net Present Value) technique does not provide evaluation in percentage format; it gives the result in currency units (e.g., dollars, euros) by calculating the present value of all cash flows associated with a project, not in percentage terms. This makes choice C incorrect as it inaccurately describes the output format of NPV calculations.

Which of the Following Is Not a Benefit Associated with Using