Which of the Following Is an Advantage of the Modified

question 21

Multiple Choice

Which of the following is an advantage of the modified internal rate of return (MIRR) over the traditional internal rate of return?

• A) Modified internal rate of return (MIRR) assumes that the cash flows are reinvested at the project's own internal rate of return (IRR).
• B) Modified internal rate of return (MIRR) assumes that the terminal value of the project is the profit from the project.
• C) Modified internal rate of return (MIRR) assumes that the cash flows are reinvested at the required rate of return.
• D) Modified internal rate of return (MIRR) assumes that the future value of cash outflow is equal to the terminal value of the project.
• E) Modified internal rate of return (MIRR) assumes that the multiple cash outflows in a project increase the required rate of return of the project.

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