When Using the Internal Rate of Return to Evaluate Investment

question 106

Multiple Choice

When using the internal rate of return to evaluate investment alternatives,which rate would analysts specify?

• A)hurdle rate.
• B)Federal funds rate.
• C)prime interest rate.
• D)time-adjusted rate.

---

Definitions:

AASB 10/IFRS 10

Standards dealing with the principles for the preparation and presentation of consolidated financial statements when an entity controls one or more other entities.

Voting Shares

Shares of a company's stock that grant the shareholder the right to vote on corporate matters, such as electing the board of directors and approving major corporate actions.

Protective Rights

Rights designed to protect the interest of the party holding those rights without giving that party power over the entity to which those rights relate.

Shared Control

A situation in business where two or more parties have the rights to govern the financial and operating policies of an enterprise in a way that both have significant influence but not full control over it.