The Internal Rate of Return (IRR)and the Net Present Value

question 20

Multiple Choice

The internal rate of return (IRR) and the net present value (NPV) are tools that are widely used in real estate investment and finance decision making.An investor would most likely pursue an investment if which of the following circumstances was true?

• A)The going-in IRR exceeds the investor's required rate of return.
• B)The going-in IRR is less than the investor's required rate of return.
• C)The NPV is negative.
• D)The NPV is equal to zero.

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Definitions:

Population

Members of a species that reside and reproduce with each other in a particular location.

Annual Grass

A type of grass that completes its entire life cycle from seed to death within one year.

Monocotyledones

Also known as monocots, a group of flowering plants characterized primarily by having one embryonic seed leaf.

Anthophyta

The division of plants that includes all flowering plants, characterized by the production of flowers and seed-containing fruits.