Q454
In capital budgeting, an internal rate of return of project is classified as its
A.
external rate of return
B.
internal rate of return
AnswerC.
positive rate of return
D.
negative rate of return
Answer: Option B
Solution
Answer: Option B
Solution:
In capital budgeting, an internal rate of return of project is classified as its internal rate of return. Internal rate of return (IRR) is the interest rate at which the NPV of all the cash flows (both positive and negative) from a project or an investment equals zero.