A. The net present value method is used to determine the difference between the present value of all future expected cash inflows and the present value of all (the initial as well as all future) expected cash outflows, using the required rate of return. A project with a positive NPV is acceptable.

B. The payback method does not recognize the time value of money and does not include discounting after-tax cash flows over the life of the project.

C. The accounting rate of return is a ratio of the amount of increased book income to the required investment. It does not recognize the time value of money and it does not include discounting after-tax cash flows over the life of the project.

D. The internal rate of return is the discount rate at which the NPV of an investment will be equal to 0, or the discount rate at which the present value of the expected cash inflows from a project equals the present value of the expected cash outflows. The company's minimum desired rate of return is used only in analyzing the results of the IRR analysis, not in doing the calculation. If the IRR is higher than the company's minimum desired rate of return, the project is acceptable.