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Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Question
Can we compute the IRR for each option without knowing the revenue figure? Why?
Expert Solution
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Step 1
The internal rate of return (IRR) is a capital budgeting metric used to gauge the benefit of expected speculations.
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Step 2
The IRR is a markdown rate which is equivalent to zero for the net present value (NPV) of all cash flows from a given venture. Counts for IRR depend on a similar equation with respect to NPV.
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