The difference between internal rate of return and modified internal rate of return is that internal rate of return has a more realistic assumption regarding reinvestment of cash flows from the project.

Question

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The Modified Internal Rate of Return (MIRR) assumes reinvestment at the project's cost of capital or a different rate, which is often more realistic than the IRR's assumption of reinvestment at the IRR itself.

The Difference Between Internal Rate of Return and Modified Internal