alleryStart learning →Unlike NPV, which measures value added, the IRR indicates an investment's:
Aresidual salvage value
Babsolute rupee gain
Cprofitability or yield
Dtotal capital outlay
Answer & Solution
Correct answer: C. profitability or yield
IRR is a percentage measure of efficiency or yield, while NPV shows the size of the value created.
Keep practising Internal Rate of Return
Browse all Internal Rate of Return questions for CA Inter, or explore more Financial Management topics.
Related questions
The same return received later gives an IRR that is:If cash flows are random variables, as in a life annuity, IRR uses their:The AIRR approach of Magni was introduced to solve problems of:In personal finance the IRR measures what type of performance?With no capital constraint, which projects does a firm accept to maximize value?Mutually exclusive projects are those from which:The equivalent annuity method divides the NPV by what to annualize it?The equivalent annuity method is often used to compare projects of: