Which of the following statements is FALSE? A) The equivalent annual annuity approach assumes that it is possible to make continuous replacements each time the asset’s life ends. B) When comparing mutually exclusive projects with unequal lives, replacement chain analysis yields the same decision as the equivalent annual annuity method. C) Mutually exclusive projects sometimes have very long lives making the replacement chain method difficult to apply. The equivalent annual annuity (EAA) is a substitute method that uses annuity concepts to value a project’s cash flows. D) A 5-year project has a NPV of $2,000, if the firm’s cost of capital is 10% the equivalent annual annuity is $725.
not in curriculum
this better not be L1… sure u didnt post on wrong forum