What is the definition of the internal rate of return?

Question

Quizplus · Accepted Answer

The internal rate of return (IRR) is the interest rate that sets the present value of a project's cash inflows equal to the present value of a project's costs. In other words, it is the rate at which the net present value (NPV) of a project is equal to zero. This is a commonly used metric in capital budgeting to evaluate the potential profitability of an investment. Options A and B are not accurate definitions of IRR, and option C describes the net present value, which is related to but different from the IRR.

What Is the Definition of the Internal Rate of Return