The IRR is defined as:
A) The discount rate that makes the 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 used in the discounted payback period method

Question

Quizplus · Accepted Answer

The IRR is the discount rate at which the present value of the cash inflows of an investment equals the initial cost of the investment (i.e., the NPV equals zero).

The IRR Is Defined As