Use the information for the question(s)below.

-If WiseGuy Ltd uses the IRR rule to choose projects, which of the projects (Project A or Project B)will rank highest?
A)Project A
B)Project B
C)Project A and Project B have the same ranking.
D)Cannot calculate a payback period without a discount rate.

Question

Use the information for the question(s)below.
 
-If WiseGuy Ltd uses the IRR rule to choose projects, which of the projects (Project A or Project B)will rank highest?
A)Project A 
B)Project B 
C)Project A and Project B have the same ranking. 
D)Cannot calculate a payback period without a discount rate.

Quizplus · Accepted Answer

The IRR rule ranks projects based on their internal rate of return. Project B has a higher IRR than Project A, so it will rank highest.

Use the Information for the Question(s)below