Question
We know that IRR is the discounted rate that forces the PV of the expected future cash flow to equal the initial cash flow. So,
We know that IRR is the discounted rate that forces the PV of the expected future cash flow to equal the initial cash flow. So, in essence, IRR forces PV to equal zero. This is helpful because the IRR is an estimate of the projects rate of return. Why do shareholders need to know the projects rate of return? What if there are multiple IRR?
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Financial Ratio Analysis
Authors: Andrew P.C.
1st Edition
1973493381, 978-1973493389
