Asked by Ailis Galdo on Jun 30, 2024
Verified
The internal rate of return is computed by finding the discount rate that equates the present value of a project's cash outflows with the present value of its cash inflows.
Discount Rate
The interest rate used in discounted cash flow (DCF) analysis to determine the present value of future cash flows.
Cash Outflows
Financial transactions representing money leaving a business, such as payments for expenses, investments, and loans.
Cash Inflows
Money or assets entering a business from various sources, including sales, investments, financing, and more.
- Gain insight into the idea of the internal rate of return (IRR) and the technique used to calculate it in the context of investment ventures.
Verified Answer
ZK
Zybrea KnightJul 04, 2024
Final Answer :
True
Explanation :
This is the correct definition of internal rate of return.
Learning Objectives
- Gain insight into the idea of the internal rate of return (IRR) and the technique used to calculate it in the context of investment ventures.