For acceptable investments, the reinvestment assumption under the internal rate of return is generally

Name: For acceptable investments, the reinvestment assumption under the internal rate of return is generally
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Question

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The reinvestment assumption under the internal rate of return is generally higher than under the net present value method because the IRR assumes that all cash flows are reinvested at the IRR, which is typically higher than the cost of capital used in the NPV calculation.

For Acceptable Investments, the Reinvestment Assumption Under the Internal Rate