Question

the investment decision should aim at investment in assets only when they are expected to earn a return greater than the minimum acceptable return is termed as
a.interest rate
b.hurdle rate
c. growth rate.
d.internal rate of return​

Answer 1

Answer:

The investment decisions should aim at investment in assets only when they are expected to earn a return greater than a minimum acceptable return, which is also called as 'hurdle rate'.

Answer 2

Answer:

The correct option is (d) Internal rate of Return.

Explanation:

• Internal Rate of Return- The estimated annual revenue, stated as a percentage, that the investment can be expected to generate for the business over and above the hurdle rate is known as the internal rate of return.

        Since the amount is "internal," potential external risks and concerns,          such as inflation, are not taken into consideration.

        Financial experts can calculate predicted returns on stocks or other investments, including yield to maturity on bonds, using IRR.

• Hurdle Rate- The lowest rate of return a project must achieve in order to cover the costs of the investment is known as the hurdle rate, also known as the least acceptable rate of return.

Hence, we can conclude that Internal Rate of return is the rate greater than the minimum acceptable rate expected to be earned when investment is made.

#SPJ2