The Flour Baker is considering a project with the following cash flows.Should this project be accepted based on its internal rate of return if the required return is 11 percent?
A)Yes, because the project's rate of return is 7.78 percent
B)Yes, because the project's rate of return is 9.36 percent
C)No, because the project's rate of return is 7.78 percent
D)No, because the project's rate of return is 9.36 percent
E)No, because the project's rate of return is 13.08 percent

Question

The Flour Baker is considering a project with the following cash flows.Should this project be accepted based on its internal rate of return if the required return is 11 percent? 
A)Yes, because the project's rate of return is 7.78 percent 
B)Yes, because the project's rate of return is 9.36 percent 
C)No, because the project's rate of return is 7.78 percent 
D)No, because the project's rate of return is 9.36 percent 
E)No, because the project's rate of return is 13.08 percent

Quizplus · Accepted Answer

The IRR is the interest rate that causes the NPV to equal zero.

The Flour Baker Is Considering a Project with the Following