The compound annual return on a project is known as its:

Question

Quizplus · Accepted Answer

The compound annual return on a project is measured by its Internal Rate of Return (IRR). Option A is incorrect because NPV measures the total present value of cash flows, not the compound return. Option B is also incorrect because Profitability Index (PI) measures the ratio of present value of future cash flows to the initial investment, not the compound return. Option C is incorrect because payback period measures the time required for the initial investment to be recouped, not the compound return.

The Compound Annual Return on a Project Is Known as Its