The ________ function indicates the profitability of an investment and is commonly used in business when choosing between investments.

Question

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The internal rate of return (IRR) function is commonly used in business to indicate the profitability of an investment and is often used to compare different investment options. It takes into account the time value of money and provides a single rate of return that measures the profitability of an investment over a specific period. NPV and XNPV are also used to evaluate investment opportunities, but IRR is commonly preferred for its simplicity and ease of interpretation. XIRR is a modified version of IRR that is used to calculate returns when the investment has irregular cash flow patterns.

The ________ Function Indicates the Profitability of an Investment and Is