In the net present value method,the only relevant operating cash flows are the ones that differ among alternatives.

Question

Quizplus · Accepted Answer

The net present value method only considers the cash flows that are relevant and differ among alternatives, as it focuses on identifying the incremental cash flows associated with a project. Any cash flows that are the same among alternatives are not considered as they do not impact the decision making process.

In the Net Present Value Method,the Only Relevant Operating Cash