When a project's internal rate of return equals the discount rate,

Question

Quizplus · Accepted Answer

When the internal rate of return (IRR) equals the discount rate, the project's net present value (NPV) is zero. This means that the project is just meeting the required rate of return, and there is no benefit to investing in the project over other opportunities with similar risk. It does not necessarily indicate any manipulation or that the discount rate is equal to the industry average.

When a Project's Internal Rate of Return Equals the Discount