1. There are analysts who believe that when using the MIRR one should use the T-bill rate as the discount/compound rate. This
A. makes no sense at all.
B. would lead to higher IRRs.
C. would result in a more conservative (risk-averse) approach to investing.
D. only makes sense for companies dealing with government projects.
E. would have no impact investment decisions.
2. The so-called “Reinvestment Rate Problem” leads to
A. the use of the MIRR.
B. an overstatement of the return using the IRR.
C. a lower NPV.
D. two or more IRRs.
E. choosing low risk/low return investments.