The computations involved in the net present value method of analyzing capital investment proposals are less involved than those for the average rate of return method.

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Quizplus · Accepted Answer

The net present value method involves more complex computations, including discounting future cash flows to their present value, which is more involved than the simpler calculations of the average rate of return method that typically uses basic arithmetic to estimate the return as a percentage of the investment.

The Computations Involved in the Net Present Value Method of Analyzing