Asked by Kaylee Craig on May 05, 2024
Verified
The internal rate of return is analogous to the yield on a bond, because both are rates that equate inflows with outflows on a present value basis.
Internal Rate
Often refers to the internal rate of return (IRR), a metric used in capital budgeting to estimate the profitability of investments.
Present Value
The current worth of a future sum of money or stream of cash flows, given a specified rate of return.
- Learn about the basic components of the Internal Rate of Return (IRR) and Modified Internal Rate of Return (MIRR), focusing on the differences between them.
Verified Answer
SR
Sofia RamirezMay 08, 2024
Final Answer :
True
Explanation :
The statement is true. Both the internal rate of return and the yield on a bond are rates that balance the present value of inflows and outflows.
Learning Objectives
- Learn about the basic components of the Internal Rate of Return (IRR) and Modified Internal Rate of Return (MIRR), focusing on the differences between them.