The internal rate of return is a capital budgeting method that calculates a discount rate at which the net present value of the project is always positive.

Question

Quizplus · Accepted Answer

The internal rate of return (IRR) is a capital budgeting metric used to estimate the profitability of potential investments. It is actually the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero, not always positive.

The Internal Rate of Return Is a Capital Budgeting Method