The MIRR statistic is different from the IRR statistic in that _____________.
A) The MIRR assumes that the cash inflows can be reinvested at the cost of capital
B) The MIRR assumes that the cash inflows can be reinvested at the IRR
C) The MIRR uses weighted-average dollars
D) The MIRR uses input from the NPV whereas the IRR does not

Question

Quizplus · Accepted Answer

The Modified Internal Rate of Return (MIRR) assumes that cash inflows are reinvested at the project's cost of capital, unlike the IRR which assumes reinvestment at the IRR itself.

The MIRR Statistic Is Different from the IRR Statistic in That