The internal rate of return method estimates the rate of return that can be expected from a contemplated investment.

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The internal rate of return (IRR) method is a capital budgeting technique that estimates the rate of return that can be earned on a contemplated investment. It takes into account the cost of the investment and the expected cash flows generated by the investment over a certain period of time. The IRR method compares the estimated rate of return to the company's required rate of return, and if the IRR is greater than or equal to the required rate of return, the investment is deemed acceptable.

The Internal Rate of Return Method Estimates the Rate of Return