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The Internal Rate of Return on an Investment Is the Discount

question 113

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The internal rate of return on an investment is the discount rate that produces a present value of benefits greater than the cost of the investment.


Definitions:

Maximize Profit

The process or strategy of adjusting the production and sales operations of a company to generate the highest possible return or profit.

Marginal Revenue

The incremental income obtained from the sale of one extra unit of a product or service.

Maximize Profit

The process of adjusting inputs and outputs in order to achieve the highest possible return on investment.

Total Revenue

The total income generated by a firm from its sales activity, calculated as the unit price of a good times the quantity of goods sold.

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