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When B/C = 1, then ROR of that project should also be = 1 True/False?

When B/C = 1, then ROR of that project should also be = 1

True/False?

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Answer #1

Answer - False

The given statement is false

B/ C ratio is just the ratio of the benefits derived from the investment to that of the cost incured and tell if the returns will be positive negative or neutral. B/C ratio of greater than 1 tell that returns will be positive. B/C ratio of 1 tells that the income will be equal to cost.

On the other hand the ROR tells that how much will be the return on the amount investment. ROR is completely different from B/C ratio.

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