Posted in Internal Rate of Return
The discount rate that makes the net present value of a revenue flow equal to zero. It is a tool to analyze investments that reflects the time value for money. The higher the investment’s internal rate of return, the more valuable the investment becomes. IRR is also known as the economic rate of return as it pursues the opportunity cost of one project against another project. With all things being equal, an investment with the highest rate of IRR should be prioritized first.
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