When the internal rate of return method is used to rank investment proposals, the higher the internal rate of return, the more desirable the investment.

Question

Quizplus · Accepted Answer

This statement is true. The internal rate of return (IRR) method is a capital budgeting technique used to evaluate and compare the profitability of investment proposals. The higher the IRR, the more attractive the investment because it represents a higher return on the initial investment.

When the Internal Rate of Return Method Is Used to Rank