Of the capital budgeting techniques discussed, which works equally well with normal and non-normal cash flows and with independent and mutually exclusive projects?
A) Payback period
B) Discounted payback period
C) Modified internal rate of return
D) Net present value

Question

Quizplus · Accepted Answer

Net present value (NPV) works well with both normal and non-normal cash flows and is applicable to both independent and mutually exclusive projects, as it considers the time value of money and provides a direct measure of the added value from the project.

Of the Capital Budgeting Techniques Discussed, Which Works Equally Well