Choose a wrong statement regarding capital budgeting.

For a business project with a negative net present value (NPV), its internal rate of

return (IRR) must be lower than the weighted average cost of capital (WACC)

used to evaluate the project.

Because the NPV and IRR of mutually exclusive projects can give opposite results,

entirely depending on the IRR method to choose a business project can minimize

the risk of misjudgment.

The big difference between the NPV and IRR methods lies on the assumption

regarding the reinvestment of cash flows during the investment periods.

The IRR and NPV methods always give the same results for independent projects.