alleryStart learning →Which factor does the IRR calculation exclude?
AAnnual cash inflows
BProject duration
CInitial outlay
DCost of capital
Answer & Solution
Correct answer: D. Cost of capital
IRR is internal to the project's own cash flows, so external factors such as the cost of capital are left out.
Keep practising Integrated Business Solutions
Browse all Integrated Business Solutions questions for CA Final, or explore more Strategic Management topics.
Related questions
In 1988 Mintzberg found the strategic process to be more?The SWOT matrix is also known as?The discount rate that gives a bond's price as NPV is called its?Applied ex-ante, what does the IRR provide?Two projects give equal returns; one pays earlier. Which has higher IRR?Rs 1,21,000 arrives in 2 years. At 10% annual discount, present value?Outlay Rs 1,00,000; inflow Rs 1,10,000 after one year; discount rate 10%. NPV?A profitable firm lacks liquidity if assets cannot be quickly?