The ________ is generally considered to be the most superior method for making capital budgeting decisions.

Question

Quizplus · Accepted Answer

The net present value method is generally considered to be the most superior method for making capital budgeting decisions as it takes into account the time value of money and the expected cash flows over the entire life of the project. The accounting rate of return method only considers the average profit earned over the life of the project, the payback method only looks at the time it takes to recover the initial investment, and the incremental method focuses on the differences between the costs and benefits of two different projects.

The ________ Is Generally Considered to Be the Most Superior