In capital budgeting, the number of non-normal cash flows having internal rate of returns are _________?
Correct answer: B. multiple
- A. one
- B. multiple
- C. accepted
- D. non-accepted
Explanation
Non-normal cash flows involve more than one change between outflows and inflows, so they may produce multiple internal rates of return. Normal cash flows generally produce only one IRR.
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About Business Finance
Business finance explains how organisations plan, obtain and use money while balancing risk, return and liquidity. Topics include financial statements, time value of money, budgeting, working capital, capital structure, sources of finance, investment appraisal and cost of capital. Capital budgeting evaluates long-term projects, whereas working capital manages day-to-day operations.
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