Q462
Modified rate of return and modified internal rate of return with exceed cost of capital if net present value is
A.
positive
AnswerB.
negative
C.
zero
D.
one
Answer: Option A
Solution
Answer: Option A
Solution:
Modified rate of return and modified internal rate of return with exceed cost of capital if net present value is positive. The modified internal rate of return is a financial measure of an investment's attractiveness. It is used in capital budgeting to rank alternative investments of equal size. As the name implies, MIRR is a modification of the internal rate of return and as such aims to resolve some problems with the IRR.