In general, the IRR comparison method and the PW comparison method
A)produce the same results for independent projects but not for mutually exclusive projects.
B)produce the same results for mutually exclusive projects but not for independent projects.
C)produce different results for both independent projects and mutually exclusive projects.
D)produce the same results for independent projects and mutually exclusive projects with unequal lives.
E)produce the same results for independent projects and mutually exclusive projects with equal lives.

Question

Quizplus · Accepted Answer

The IRR (Internal Rate of Return) and PW (Present Worth) comparison methods generally produce the same results for both independent projects and mutually exclusive projects when the projects have equal lives. This is because both methods evaluate the financial performance of projects over their entire lifespan, and when the projects being compared have the same duration, the comparison is straightforward and yields consistent results.

In General, the IRR Comparison Method and the PW Comparison