If the discount rate used is increased, both the net present value and the internal rate of return will decrease.

Name: If the discount rate used is increased, both the net present value and the internal rate of return will decrease.
Brand: Quizplus
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Question

Quizplus · Accepted Answer

Increasing the discount rate decreases the net present value (NPV) but does not affect the internal rate of return (IRR); the IRR is a project-specific rate of return and remains constant regardless of changes in the discount rate.

If the Discount Rate Used Is Increased, Both the Net