For a lending investment project, which of the following is a bad decision rule? If IRR is less than cost of capital: reject If IRR is greater than cost of capital: accept If profitability index is less than O: accept If profitability index is greater than O:accept
For a lending investment project, which of the following is a bad decision rule? If IRR is less than cost of capital: reject If IRR is greater than cost of capital: accept If profitability index is less than O: accept If profitability index is greater than O:accept
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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7.For a lending investment project, which of the following is a bad decision rule?
If IRR is less than cost of capital: reject
If IRR is greater than cost of capital: accept
If profitability index is less than O: accept
If profitability index is greater than O:accept
Transcribed Image Text:For a lending investment project, which of
the following is a bad decision rule?
O If IRR is less than cost of capital: reject
If IRR is greater than cost of capital: accept
O If profitability index is less than 0: accept
O If profitability index is greater than 0: accept
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