Alternative Project Evaluation Criteria

Abstract

Though net present value and sets of internal rates of return are completely equivalent criteria for prolect acceptability decisions, they collectively offer an infinite number of differing implications with regard to levels of project incomes, wealth bases and rates of return. If reinvestment is assumed, there are also sets of average rates of return, equivalent for project acceptability decisions and corresponding, one-to-one, with sets of internal rates and their implications. But the popu’ar constant average and internal rates do not correspond in this way; thus, in general, they differ with regard to project income, wealth base and rate of return implications.

Source: THE ENGINEERING ECONOMIST.VoI. 38 • No.3 .Spring 1993, p. 165.   For the complete article in Pagis Pro 3.0 format contact the author at bernhar@eos.ncsu.edu or Ray_Martin@AltaVista.net.  Download a Pagis Pro 3.0 reader at ftp://ftp.scansoft.com/pub/program/pagis/viewer.exe.

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