Assertion A When two or more investment proposals are mutually exclusive ranking the proposals on th...........

Miscellaneous Others

Assertion (A) : When two or more investment proposals are mutually exclusive, ranking the proposals on the basis of IRR,NPV and PI methods may give contradictory results.

Reason (R) : The contradictory results in the ranking are due to differing dimensions relating to the scale of investments, cash flow patterns and project lives. Indicate the correct answer : (2 marks)

Codes :

Both (A) and (R) are true.

(A) is true, but (R) is a necessary condition, but not a sufficient condition.

Both (A) and (R) are false.

Both (A) and (R) are true and (R) explains the reason sufficiently.