Which of the following statements is CORRECT? Assume that the project being considered has normal cash flows,with one cash outflow at t = 0 followed by a series of positive cash flows.
A) A project's MIRR is always less than its regular IRR.
B) If a project's IRR is greater than its WACC, then its MIRR will be greater than the IRR.
C) To find a project's MIRR, we compound cash inflows at the regular IRR and then find the discount rate that causes the PV of the terminal value to equal the initial cost.
D) To find a project's MIRR, the textbook procedure compounds cash inflows at the WACC and then finds the discount rate that causes the PV of the terminal value to equal the initial cost.
E) A project's MIRR is always greater than its regular IRR.

Question

Quizplus · Accepted Answer

Answer d is essentially the definition of the MIRR; hence,it is correct.

Which of the Following Statements Is CORRECT? Assume That the Project