What Is the First Step of the Internal Rate-Of-Return (IRR)method

question 37

Multiple Choice

What is the first step of the internal rate-of-return (IRR) method?

• A)Compute a sensitivity analysis.
• B)Ignore the discount rate in the NPV computation.
• C)Calculate the net initial investment.
• D)Use a discount rate and calculate the project's NPV.
• E)Calculate the payback period.

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Definitions:

Agent

A person or entity authorized to act on behalf of another person or entity, known as the principal, in business transactions or legal matters.

Employment

An agreement between an employer and an employee where the employee provides labor or services on a regular basis in exchange for compensation.

Principal

A principal can refer to the amount of money being borrowed or the party managing a group, depending on the context.

Negligently Left

Describes a situation where an individual or entity fails to take proper care in doing something, resulting in something being left behind or unattended in a manner that could cause harm or loss.