Ron’s Organic Markets has limited access to borrowed funds and must choose among several independent projects with returns greater than their cost of capital. All the projects under consideration have the same required investment of $ 2 million and Ron’s has $10 million available for capital investments this year. Which of the following selection criteria is least likely to produce the optimal five projects for investment Choose the five projects with:（）
A. the greatest total NPV.
B. the largest sum of profitability indexes.
C. the highest IRRs.
参考答案：C
解析：
Since the net present value of the five projects is the expected increase in firm value from undertaking the projects, maximizing the NPV of the projects chosen will result in the selection of the optimal group of five projects. Since the profitability index is the ratio of the present value of the expected after-tax cash flows to the initial outlay, choosing the five projects with the greatest profitability indexes will identify the five projects with the greatest total present values and the projects with the greatest total net present values.