All of the following statements are correct except:
A) The NPV and IRR methods will always agree on whether a project enhances or harms shareholder wealth.
B) If a project has a positive NPV, its IRR will always be greater than the cost of capital.
C) If a project has a negative NPV, its IRR will always be less than the cost of capital.
D) There is never a conflict between NPV and IRR in the case of mutually exclusive projects.

Question

Quizplus · Accepted Answer

There can be conflicts between NPV and IRR in the case of mutually exclusive projects, as the two methods assume different reinvestment rates. Additionally, statements A, B, and C are all correct.

All of the Following Statements Are Correct Except