UGC NET COMMERCE November 2017(Paper-II) Q35
- Option : B
- Explanation : Internal Rate of Return (IRR): The discount rate on an investment that equates the present value of the investment’s cash outflows with the present value of the investment’s cash inflows. For instance, if you spend $50,000 on a given investment, the IRR per cent would be the annualized rate of return of the profit. It’s not just the annual rate of return per year multiplied by the number of years. If you loan $50,000 and get no interest the first year, but you get $20,000 in interest or return in the second year, you actually got about $10,000 each year, so the IRR is approximately 20 per cent.
