Although the replacement chain approach is appealing for dealing with mutually exclusive projects that have different lives, it is not used in practice because no projects meet the assumptions the method requires.

Question

Quizplus · Accepted Answer

The statement is incorrect. The replacement chain approach is used in practice, but its applicability is limited because it requires the projects to have equal lives and equal costs. However, there are still cases where this approach can be applied, especially in the context of capital budgeting.

Although the Replacement Chain Approach Is Appealing for Dealing with Mutually