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Commerce · Q106

Business Finance

Graduate and Post Graduate · Commerce · question 106

Q106

Assertion (A): The IRR of a project is the discount rate which reduces its NPV to zero. Reason (R): A project is worth accepting if the IRR exceeds the cost of capital.

A.
(A) is true, but (R) is false
B.
Both (A) and (R) are true
Answer
C.
(A) is false, but (R) is true
D.
Both (A) and (R) are false

Answer: Option B

Solution

Answer: Option B
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