Suppose​ we’re evaluating a project with an NPV of​ $20 million and an IRR of​ 14%. If we double all cash flows​ (both positive and​ negative), scaling everything up​ proportionally, then we will double the NPV but the IRR​ won’t change at​ all, since IRR does not consider scale.   True   False

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Suppose​ we’re evaluating a project with an NPV of​ $20 million and an IRR of​ 14%. If we double all cash flows​ (both positive and​ negative), scaling everything up​ proportionally, then we will double the NPV but the IRR​ won’t change at​ all, since IRR does not consider scale.
 
True
 
False
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