What is meant by the term internal rate of return

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Assignment: 1. What is meant by the term internal rate of return? Explain the RR decision rule?

2. For the purpose of calculating net present value and internal rate of return, do companies use the accru; basis of accounting? Explain.

3. Why might a ?rm choose to accept a long-terrn investment even if the net present value is below zero?

4. What might cause a manager to reject a long-term investment even though the net present value is positive?

5. Describe the two steps required to calculate net present value and internal rate of return when using Excel.

Reference no: EM132759993

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