Multiple choice

In comparing two projects where their cash flows are not the same in terms of volumes and signs,

  1. IRR method is helpful

  2. IRR method not very helpful

  3. IRR method is not applicable at all

  4. IRR method is applicable
Reveal answer Fill a bubble to check yourself
C Correct answer
Explanation

IRR method wil not be applicable here as internal rate of return (IRR) is a metric used in capital budgeting measuring the profitability of potential investments. When comparing two projects where their cash flows are not the same in terms of volumes and signs, IRR method is not applicable at all.

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