Which method of capital budgeting is best used for longer term capital investments?

Question

Quizplus · Accepted Answer

Both Net Present Value (NPV) and Internal Rate of Return (IRR) are appropriate methods for longer term capital investments. NPV calculates the present value of cash inflows and outflows, while IRR calculates the rate at which the project breaks even. Both methods take into account the time value of money and help in evaluating the profitability and feasibility of long term investments.

Which Method of Capital Budgeting Is Best Used for Longer