What assumption makes the approximate method of finding the external rate of ret

Question

What assumption makes the approximate method of finding the external rate of return a proxy?

a) All receipts and disbursements of a project are assumed to be invested at a minimum acceptable rate of return

b) Receipts and disbursements that occur when a project's balance is positive are assumed to be invested at a minimum acceptable rate of return

c) A project's balance is assumed to be always positive

d) All receipts of a project are assumed to be invested at a minimum acceptable rate of

a) All receipts and disbursements of a project are assumed to be invested at a minimum acceptable rate of return

b) Receipts and disbursements that occur when a project's balance is positive are assumed to be invested at a minimum acceptable rate of return

c) A project's balance is assumed to be always positive

d) All receipts of a project are assumed to be invested at a minimum acceptable rate of

Explanation / Answer

b is correct

The approximate method of finding the external rate of return a proxy is that receipts and disbursements that occur when a project's balance is positive are assumed to invested at a minimum acceptable rate of return.

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