Answer-Which of the following statement is not true:

Question

Which of the following statement is not true:

A Sensitivity analysis involves identification of crucial variable relating to costs and returns, specification of alternative values of the crucial variables and re-computation of the NPV and IRR by using the alternative values.

B The risk analysis adds valuable information to the project analysis and it is an important tool in this respect but to take up investment or not depends on the risk-taking capacity of the entrepreneur.

C IRR represents the returns internally generated by the project. This is also the rate which makes the net present value equal to 1.

D The project is considered viable if the IRR is more than the acceptable rate for the entrepreneur which could be the opportunity cost for his funds.

E All are correct

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