If Internal Rate of Return Is Less Than Required Rate

question 86

True/False

If internal rate of return is less than required rate of return, the net present value is positive.

---

Definitions:

Direct Cost

Costs that are directly attributable to the production of goods or services, such as labor and materials.

Variable Manufacturing Costs

Costs that vary directly with the level of production output, such as raw materials, labor, and energy consumption.

Cost-Plus Pricing

A pricing strategy where a fixed percentage is added to the total cost of producing a product to determine its selling price.

Mark-Up Percentage

The fraction that is added onto the cost price of items to include overhead costs and profit within the selling price.