The interest rate that discounts a series of future cash flows to its present value is called the
A)internal rate of return.
B)external rate of return.
C)creditors rate of return.
D)prime lending rate published in The Wall Street Journal.
E)federal funds rate.

Question

Quizplus · Accepted Answer

The internal rate of return (IRR) is the interest rate that makes the present value of a project's cash inflows equal to the present value of its cash outflows, also known as the discount rate.

The Interest Rate That Discounts a Series of Future Cash