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Does a Project That Generates a Positive Internal Rate of Return

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Does a project that generates a positive internal rate of return also have a positive net present value? Explain.


Definitions:

Unique Risk

The risk specific to an individual asset, such as a stock, which can be mitigated through diversification.

Individual Security

A financial instrument (such as a stock or bond) representing an individual's ownership or creditor relationship with a corporation or governmental entity.

Market Risk Premium

The excess return that investors require for choosing a risky investment over a risk-free investment.

Risk-averse

Referring to the preference of minimizing exposure to risk and avoiding situations that could lead to loss.

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