While ________ method is the most reliable method when evaluating an acquisition investment,real-world practitioners often use ________ and ________ as alternative valuation metrics.
A) the NPV; the IRR; the cash multiple (or multiple of money)
B) the IRR; the NPV; the cash multiple (or multiple of money)
C) the cash multiple; the NPV; the IRR
D) none of the above

Question

Quizplus · Accepted Answer

The NPV (Net Present Value) method is considered the most reliable method when evaluating an acquisition investment as it takes into account the time value of money and provides an absolute value of the investment. However, real-world practitioners often use the IRR (Internal Rate of Return) and cash multiple (or multiple of money) as alternative valuation metrics, as they also provide useful insights into the potential return on investment.

While ________ Method Is the Most Reliable Method When Evaluating