Shore Builders is considering a project with an internal rate of return of 16.5%. Shore Builders requires a minimum rate of return of 14%. What is the net present value of the project?

Question

Quizplus · Accepted Answer

If the internal rate of return (IRR) is greater than the required rate of return, the net present value (NPV) would be positive, meaning that the project is expected to generate value exceeding its costs. In this case, the IRR of 16.5% is higher than the minimum required rate of 14%, indicating that the NPV is positive. Thus, the best choice is B.

Shore Builders Is Considering a Project with an Internal Rate