Which of the following is most correct? The modified IRR (MIRR) method:
A)Always leads to the same ranking decision as NPV for independent projects.
B)Overcomes the problem of multiple rates of return.
C)Compounds cash flows at the required rate of return.
D)Overcomes the problem of cash flow timing and the problem of project size that leads to criticism of the regular IRR method.
E)Answers b and c are both correct.

Question

Quizplus · Accepted Answer

The MIRR method overcomes the problem of multiple rates of return and compounds cash flows at the required rate of return, addressing some limitations of the regular IRR method.

Which of the Following Is Most Correct? the Modified IRR