The ________ method calculates return using after-tax cash flows and the time value of money.

Question

Quizplus · Accepted Answer

The IRR method takes into account the after-tax cash flows and the time value of money to determine the return on investment. A is incorrect because IR is not a commonly used financial metric. C is incorrect because AARR is not a widely recognized method of calculating return. D is incorrect because the hurdle rate is a minimum required rate of return set by an investor or company, and does not take into account after-tax cash flows. E is incorrect because the cost of capital is the rate of return required by investors to provide capital to a company, and does not take into account after-tax cash flows.

The ________ Method Calculates Return Using After-Tax Cash Flows and the Time