The net present value method can only be used in capital budgeting if the expected cash flows from a project are an equal amount each year.

Question

Quizplus · Accepted Answer

The net present value method can be used in capital budgeting even if the expected cash flows from a project are not equal each year. However, if the cash flows are not equal, the calculation of the net present value will require a more complex formula or the use of financial software.

The Net Present Value Method Can Only Be Used in Capital