The internal rate of return is:
A) the discount rate that makes the net present value of a project equal to the initial cash outlay.
B) equivalent to the discount rate that makes the net present value equal to one.
C) tedious to compute without the use of either a financial calculator or a computer.
D) highly dependent upon the current interest rates offered in the marketplace.
E) a better methodology than net present value when dealing with unconventional cash flows.

Question

The internal rate of return is: 
A) the discount rate that makes the net present value of a project equal to the initial cash outlay. 
B) equivalent to the discount rate that makes the net present value equal to one. 
C) tedious to compute without the use of either a financial calculator or a computer. 
D) highly dependent upon the current interest rates offered in the marketplace. 
E) a better methodology than net present value when dealing with unconventional cash flows.

Quizplus · Accepted Answer

The Answer of The internal rate of return is: 
A) the discount rate that makes the net present value of a project equal to the initial cash outlay. 
B) equivalent to the discount rate that makes the net present value equal to one. 
C) tedious to compute without the use of either a financial calculator or a computer. 
D) highly dependent upon the current interest rates offered in the marketplace. 
E) a better methodology than net present value when dealing with unconventional cash flows.

The Internal Rate of Return Is