Question

Match the items of the following two lists and suggest the correct code.

List-I	List-II
a) Pay-back Rate of Return	i) Discounted Cash Flow Technique
b) Internal Rate of Return	ii) Compounded values of investments and returns
c) Benefit Cost Ratio	iii) Crude method for project evaluation
d) Net Terminal Value Method	iv) Varying sized projects evaluation

• A. (a)-(ii), (b)-(iii), (c)-(i), (d)-(iv)
• B. (a)-(iii), (b)-(i), (c)-(iv), (d)-(ii)
• C. (a)-(i), (b)-(iv), (c)-(ii), (d)-(iii)
• D. (a)-(iv), (b)-(ii), (c)-(iii), (d)-(i)

Answer 1

The correct option is B (a)-(iii), (b)-(i), (c)-(iv), (d)-(ii)

1. Pay-back rate of return states that in how much time business will be able to recover its cost of a particular project.

2. Internal rate of return is that discount rate where outflow=inflow.

3. Benefit cost ratio analyzes how much a company or firm is benefited from a particular investment in certain project.

4. Net terminal value method compounded value of projects return or investments made by the company.