Which of the following statements is CORRECT?
A) The MIRR and NPV decision criteria can never conflict.
B) The IRR method can never be subject to the
C) One reason some people prefer the MIRR to the regular IRR is that the MIRR is based on a generally more reasonable reinvestment rate assumption.
D) The higher the WACC, the shorter the discounted payback period.
E) The MIRR method assumes that cash flows are reinvested at the crossover rate.

Question

Quizplus · Accepted Answer

The MIRR (Modified Internal Rate of Return) assumes reinvestment at the project's cost of capital, which is generally more reasonable than the IRR's assumption of reinvestment at the IRR itself.

Which of the Following Statements Is CORRECT