The Modified IRR (MIRR) Method Has Wide Appeal to Professors

question 55

True/False

The modified IRR (MIRR) method has wide appeal to professors, but most business executives prefer the NPV method to either the regular or modified IRR.

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Definitions:

Carrying Value

The book value of assets and liabilities as presented on a company’s balance sheet, which is the original cost minus any depreciation, amortization, or impairment costs.

Secured Bonds

Bonds that have specific assets of the issuer pledged as collateral.

Collateral

An asset pledged by a borrower to secure a loan or other credit, and subject to seizure if the loan is not repaid according to the agreed terms.

Specific Assets

Assets identified and itemized separately for accounting, legal, or financial purposes.