A firm determines that its IRR for a new product is 12%. For which discount rate does it make sense to develop the product?
A) 9%
B) 13%
C) 15%
D) 20%

Name: A firm determines that its IRR for a new product is 12%. For which discount rate does it make sense to develop the product? A) 9% B) 13% C) 15% D) 20%
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Question

Quizplus · Accepted Answer

If the discount rate is less than the IRR (12%), the project is expected to generate a positive net present value, making it a good investment.

A Firm Determines That Its IRR for a New Product