You have made an investment of $250 that will yield a profit of $30 in one year.If the interest rate is 11.5%,what is your internal rate of return?
A) 10.7%
B) 11.8%
C) 12.0%
D) 12.2%

Question

Quizplus · Accepted Answer

The internal rate of return (IRR) is the interest rate at which the net present value of all the cash flows (both positive and negative) from a project or investment equal zero. In this case, the investment of $250 yields a profit of $30 in one year, making the total amount $280. The IRR can be found using the formula for the rate of return: IRR = (Net Profit / Initial Investment) * 100 = ($30 / $250) * 100 = 12%.

You Have Made an Investment of $250 That Will Yield