The internal rate of return, often called yield to maturity, is the discount rate that equates the future cash flows to the market value at any date.

Question

Quizplus · Accepted Answer

This statement is true. The internal rate of return, or IRR, represents the discount rate that will make the present value of a series of future cash flows equal to the initial investment or market value of an investment. It is often referred to as the yield to maturity for bonds or fixed income securities.

The Internal Rate of Return, Often Called Yield to Maturity