The internal rate of return shows the economic merits of several projects and can compare their returns to other financial indicators, such as the weighted average cost of capital and the company's aggregate rate of return.

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The internal rate of return (IRR) is a financial metric used to evaluate the profitability of potential investments. It is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. IRR can be used to compare the profitability of multiple projects and see how they stack up against other financial indicators like the weighted average cost of capital (WACC) or the company's overall rate of return, helping in making investment decisions.

The Internal Rate of Return Shows the Economic Merits of Several