If the NPV (Net Present Value)of a project with one sign reversal is positive,then the project's IRR (Internal Rate of Return)________ the required rate of return.
A) must be less than
B) must be greater than
C) could be greater or less than
D) Cannot be determined without actual cash flows

Question

Quizplus · Accepted Answer

The IRR is the discount rate that makes the NPV of a project equal to zero. If the NPV is positive, then the IRR must be greater than the required rate of return, which is the discount rate that makes the NPV equal to zero.

If the NPV (Net Present Value)of a Project with One