There Are Two Basic Steps in Calculating the Internal Rate

question 87

Multiple Choice

There are two basic steps in calculating the internal rate of return.Which of the following represents those two steps?

• A) (1) Compute the PV factor for the project and (2) compare it to the hurdle rate.
• B) (1) Compute the PV factor for the project and (2) identify the discount rate.
• C) (1) Identify the discount rate and (2) compare the IRR to the hurdle rate.
• D) (1) Compare IRR to the hurdle rate and (2) accept or reject the project.
• E) (1) Select the hurdle rate and (2) compute the PV factor for the project.

---

Definitions:

Not Guilty

A legal verdict stating that there is not enough evidence to prove beyond a reasonable doubt that the accused committed the offense.

Irresistible Impulse Test

A legal defense principle suggesting a person should not be held responsible for their actions if they could not control their impulses due to a mental illness.

Fit of Passion

An intense and sudden display of emotion, such as anger or excitement, that can result in unpredictable behavior.

M'Naghten Rule

A legal standard for determining criminal insanity, which focuses on whether the defendant was able to understand the nature and quality of the act or knew it was wrong.