Negative NPV.   Multiple IRRs.   Non-existent IRR.   Negative profitability index.

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter10: Decentralization: Responsibility Accounting, Performance Evaluation, And Transfer Pricing
Section: Chapter Questions
Problem 6DQ: What are two disadvantages of ROI? Explain how each can lead to decreased profitability.
Question

 

  • Negative NPV.

  •  

    Multiple IRRs.

  •  

    Non-existent IRR.

  •  

    Negative profitability index.

 
 
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