The Discount Rate Is Used for Calculating the NPV Is

question 72

Multiple Choice

The discount rate is used for calculating the NPV is:

• A) Determined by the financial markets
• B) Found by the government
• C) Found by the CEO
• D) None of the above

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Definitions:

MIRR

Modified Internal Rate of Return, a financial measure used to assess the attractiveness of investments by accounting for the cost of borrowing and reinvestment rates.

Cash Flows

The aggregate sum of money entering and exiting a business, notably affecting its cash flow.

WACC

Weighted Average Cost of Capital is an evaluation method for determining the cost of a company's capital, with each source of capital weighted based on its relative proportion.

Present Value

Present value is the current worth of a future sum of money or stream of cash flows, given a specified rate of return.