Question

Theoretically, a company comparing multiple projects with similar investment requirements and durations would select projects with __________.

Answer 1

the highest IRR

Step-by-step explanation:

The IRR is the rate that makes the net present value of the cash flows, both inflows and outflows, equal to zero. Assuming all projects require the same upfront investment, the project with the highest internal rate of return would be considered the best. The IRR is a very popular method because, generally, businesses love percentage rates.

Answer 2

D.)

the highest IRR

Step-by-step explanation:

Here are the options to the question :

A.)

the IRR that is closest to zero

B.)

a negative IRR

C.)

the lowest IRR

D.)

the highest IRR

IRR is a capital budgeting method.

Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested

The higher the IRR, the more profitable the project is.

In the absence of certain restrictions, the project with the highest IRR should be chosen