The Internal Rate of Return Is

question 8

Multiple Choice

The internal rate of return is:

• A) the discount rate that makes the NPV greater than zero.
• B) the discount rate that makes the NPV equal to zero.
• C) the discount rate that makes the NPV less than zero.
• D) both a and c.

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Definitions:

Credit Sales

Sales transactions where the payment is deferred, allowing the buyer to purchase goods or services on account.

Bank Credit Cards

Financial instruments issued by banks that allow cardholders to purchase goods and services on credit, up to an approved credit limit.

Merchandise on Account

Items purchased on credit, where payment is made at a later date, often recorded as accounts payable.

Collection on Account

This term refers to the payment received by a business from its customers against the outstanding invoices or credits.