Question

Internal rate of return is:
Select one:
O a. Rate at which discounted cash inflow is equal to the discounted cash outflow
O b. Rate at which discounted cash inflow is less than discounted cash outflow
O C. Rate at which discounted cash inflow is more than discounted cash outflow​

Answer 1

Answer:

b is the answer hope it helps you

Answer 2

Option (a) is the correct option.

Explanation:

Internal rate of return is rate at which discounted cash inflow is equal to the discounted cash outflow.

• The internal rate of return (IRR) is a discounting cash flow technique which gives a rate of return earned by a project.
• The IRR of an investment is the discount rate at which the net present value of costs (negative cash flows ) of the investment equals the net present value of the benefits (positive cash flows) of the investment.
• IRR is used in capital budgeting to measure and compare the profitability of investments in different projects.
• The higher IRR, the more desirable the project.