The IRR is defined as:
A)the discount rate that makes a project's NPV equal to zero.
B)the difference between the cost of capital and the present value of the cash flows.
C)the discount rate used in the NPV method.
D)the discount rate

Question

Quizplus · Accepted Answer

The IRR (Internal Rate of Return) is the discount rate that results in a project’s NPV (Net Present Value) being equal to zero. In other words, the IRR is that rate of return at which the present value of the future cash flows of a project equals its initial investment outlay.

The IRR Is Defined As