The _____ of an investment makes the net present value of all cash flows (benefits and costs) generated by a project equal to zero.
A) net present value
B) internal rate of return
C) earnings growth
D) market share

Question

Quizplus · Accepted Answer

The internal rate of return (IRR) is the discount rate at which the net present value (NPV) of cash flows from a project equals zero. This means that the costs and benefits of an investment are balanced, making it a valuable tool for evaluating the profitability of a project. The other options (A, C, D) do not directly relate to the process of determining the rate of return on an investment.

The _____ of an Investment Makes the Net Present Value