Question

The internal rate of return is the: Select one: a. Discount rate that results in a zero net present value for the project. b. Rate of return required by the project’s investors. c. Project’s current market rate of return. d. None of these choices. e. Discount rate that results in a net present value equal to the project cost.

Answer 1

Answer:

e. Discount rate that results in a net present value equal to the project cost.

Explanation:

The internal rate of return is the discounted rate of return at which the net present value is zero that shows the initial investment or the invested amount should be equal to the yearly cash flows present value after considering the discounting factor

Hence, the correct option is e as it defines the internal rate of return