公司理财英文版第九章.pptVIP

8.* Students may ask where you came up with the 25%. Point out that this is one of the drawbacks of this rule. There is no good theory for determining what the return should be. We generally just use some rule of thumb. This rule would indicate that we reject the project. 8.* The answer to all of these questions is no. In fact, this rule is even worse than the payback rule in that it doesn’t even use cash flows for the analysis. It uses net income and book value. Thus, it is not surprising that most surveys indicate that few large firms employ the payback and/or AAR methods exclusively. 8.* L