The Reinvestment Approach to the Modified Internal Rate of Return

question 93

Multiple Choice

The reinvestment approach to the modified internal rate of return:

• A)individually discounts each separate cash flow back to the present.
• B)reinvests all the cash flows, including the initial cash flow, to the end of the project.
• C)discounts all negative cash flows to the present and compounds all positive cash flows to the end of the project.
• D)discounts all negative cash flows back to the present and combines them with the initial cost.
• E)compounds all of the cash flows, except for the initial cash flow, to the end of the project.