The internal rate of return will be higher if

Question

The internal rate of return will be higher if​

Quizplus · Accepted Answer

The internal rate of return (IRR) represents the discount rate that makes the net present value (NPV) of an investment equal to zero. Therefore, a lower cost of investment leads to a higher IRR because the initial outflow of cash is lower, making the investment more profitable. The cost of capital does not directly affect the IRR, although it can impact the decision to undertake the investment in the first place. Higher costs of capital could make an investment less attractive, regardless of the IRR.

The Internal Rate of Return Will Be Higher If​

The Internal Rate of Return Will Be Higher If