About capital investment analysis

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Which of the following statements about capital investment analysis is most correct?

a) Although a useful accounting concept, breakeven analysis has no role in capital investment analysis.

b) On most projects, the NPV and IRR measures will give conflicting results, so managers must use judgment as to which measure to use.

c) Net present value (NPV) measures a project’s rate of return, whereas internal rate of return (IRR) measures a project’s dollar return.

d) Payback measures the length of time it takes to recover the initial investment in the project.

e) An NPV of zero indicates that the project is expected to return the amount of the initial investment, but it will not provide a return on that investment.

Reference no: EM13976304

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