A firm's required rate of return is the rate which makes the:
A) Net present value equal to zero.
B) Internal rate of return equal to the average rate of return.
C) Profitability index greater than zero.
D) Determination of the NPV possible.

Question

Quizplus · Accepted Answer

A firm's required rate of return is the rate at which the net present value of an investment is equal to zero. This means that the present value of cash inflows equals the present value of cash outflows, and there is no profit or loss.

A Firm's Required Rate of Return Is the Rate Which