When using the internal rate of return method to evaluate investment projects,if the internal rate of return is less than the required rate of return,the project should be accepted.

Question

Quizplus · Accepted Answer

If the internal rate of return is less than the required rate of return, it means that the project's return is lower than the minimum rate of return expected by the investor. In this scenario, it would not make sense to invest in the project as it would not generate enough returns to cover the required rate of return. Hence, the project should be rejected, not accepted.

When Using the Internal Rate of Return Method to Evaluate