Which of the following choices correctly states how funds are assumed to be reinvested under the net-present-value method and the internal-rate-of-return method?

Question

Quizplus · Accepted Answer

Under the net-present-value method, funds are assumed to be reinvested at the discount rate used to calculate the present value of the cash flows. Under the internal-rate-of-return method, funds are assumed to be reinvested at the same rate as the IRR. Choice B accurately states this.

Which of the Following Choices Correctly States How Funds Are