Which of the Following Best Describes the Internal Rate-Of-Return (IRR)

question 80

Multiple Choice

Which of the following best describes the internal rate-of-return (IRR) method?

• A) it calculates the discount rate at which an investment's present value of the total of all expected cash inflows equals the present value of its expected cash outflows.
• B) it calculates the discount rate at which an investment's future value of all expected cash inflows equals the present value of its expected cash outflows.
• C) it calculates the discount rate at which an investment's total of all expected cash inflows equals the present value of its expected cash outflows.
• D) it calculates the discount rate at which sum of an investment's present value of all expected cash inflows equals the present value of its expected cash outflows.

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Definitions:

Trachea

The windpipe; a large membranous tube reinforced by rings of cartilage, extending from the larynx to the bronchial tubes and conveying air to and from the lungs.

Windpipe

Another term for the trachea, the large airway that leads from the throat (pharynx) to the lungs, allowing for air passage.

Nasal Cavity

A large air-filled space above and behind the nose in the middle of the face, part of the respiratory system, which filters, warms, and moistens air breathed in through the nose.

Larynx

An organ located in the neck of mammals that is involved in breathing, sound production, and protecting the trachea against food aspiration.