For independent projects, net present value analysis and internal rate of return analysis yield the same decision.

Question

Quizplus · Accepted Answer

This statement is true. Net present value (NPV) and internal rate of return (IRR) should yield the same decision for independent projects. If the NPV is positive and the IRR is greater than the required rate of return, then the project should be accepted. If the NPV is negative and the IRR is less than the required rate of return, then the project should be rejected.

For Independent Projects, Net Present Value Analysis and Internal Rate