If a net present value analysis for a normal project gives an NPV greater than zero, an internal rate of return calculation on the same project would yield an internal rate of return ____ the required rate of return for the firm.
A) greater than
B) less than
C) equal to
D) Cannot be determined from the information given

Question

Quizplus · Accepted Answer

If the NPV is greater than zero, it means the project is expected to generate a return higher than the required rate of return for the firm. Therefore, the internal rate of return should be greater than the required rate of return.

If a Net Present Value Analysis for a Normal Project