Question

_____ is the rate that causes the present value of all cash flows from a property (including its resale value) to be equal to the original purchase price of the property.

a) IRR
b) NPV
c) TWR
d) TVM

Answer 1

a) IRR

Step-by-step explanation:

The internal rate of return is the rate of return at which the net present value is zero

The net present value means the difference between the present value of all cash inflows after discounted and the initial investment

Therefore when the above two things are equivalent to each other so this we called as internal rate of return (IRR)

hence, the correct option is a.