Question: Consider the following cash flow patterns: Pattern I : - $100 + $200 + 200 +200 Pattern II : - $ 100 + $ 200

Consider the following cash flow patterns:

Pattern I : - $100 + $200 + 200 +200

Pattern II : - $ 100 + $ 200 + 200 - 150

In which case, IRR is an unreliable criteria for capital budgeting decisions:

a.

Pattern I only
b.

Pattern II only

c.

Both Pattern I and Pattern II
d.

Neither pattern I nor pattern II

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