Which of the following is an advantage of the IRR?
A)The IRR is the easiest to calculate of all the capital budgeting techniques.
B)The IRR will always lead to a wealth-maximizing decision as long as the inputs are correct.
C)The IRR can be calculated even if the appropriate cost of capital is unknown.
D)Both A and B are advantages of the IRR.

Question

Quizplus · Accepted Answer

The IRR can be calculated without knowing the appropriate cost of capital, making it useful for comparing the profitability of projects independently of the current financing costs.

Which of the Following Is an Advantage of the IRR