Question

Whenever the internal rate of return on a project equals that project's required rate of return, Group of answer choices the net present value is less than zero. the net present value is greater than zero. the payback period equals 5 years. the net present value equals zero.

Answer 1

the net present value equals zero

Step-by-step explanation:

Net present value method: In this method, the initial investment is subtracted from the discounted present value cash inflows. If the amount comes in positive than the project is beneficial for the company otherwise not.

Internal rate of return: The internal rate of return is that return at which the net present value is equal to zero which means that the internal rate of return is the same as the project required rate of return