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 sacle of investments, cash flow patterns and project lives.

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 sacle of investments, cash flow patterns and project lives. Correct Answer (A) is true, but (R) is a necessary condition, but not a sufficient condition

Related Questions

Assertion (A): The IRR of a project is the discount rate which reduces its NPV to zero.
Reason (R): A project is worth accepting if the IRR exceeds the cost of capital.