Question

Which of the following is not one of the benefits of using NPV over IRR to...

Which of the following is not one of the benefits of using NPV over IRR to judge a capital budgeting decision?

IRR assumes that cash flows generated from the capital budgeting decision can be reinvested at the same rate of return as the project itself, NPV does not.

NPV can be used to judge capital budgeting decisions with nonstandard cash flows, whereas IRR cannot.

Unlike for IRR, the results from an NPV analysis can be easily compared to other capital budgeting options, and the results are easy to convey.

Unlike IRR results, NPV results will always lead an analyst to choose the best of a series of mutually exclusive investment options.
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Answer #1

unlike for internal rate of return the result from net present value analysis can be easily compared to other capital budgeting decisions options and result are easy to convey and it is not an benefit of of net present value over internal rate of return.

Other examples are clear benefits of net present value over internal rate of return.

Correct answer will be option (C) unlike for internal rate of return the result from net present value can be easily compared to other capital budgeting decision and the results are easy to convey.

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