Which of the following statements is correct?
A. The internal rate of return (IRR) does not allow you to determine whether mutually exclusive projects are acceptable.
B. The net present value (NPV) is the only capital budgeting technique that allows you to determine which independent projects are acceptable.
C. The net present value (NPV)technique provides an indication of the dollar benefit (on a present value basis) to the firm's shareholders of purchasing a capital budgeting project.
D. A project's internal rate of return (IRR) depends on the firm's required rate of return, which means that a project's IRR is different for each firm that has a different required rate of return.
E. The net present value (NPV) technique contains information about a project's safety margin, which is not inherent in the internal rate of return (IRR).
Answer: C
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