A project with an IRR of 6% assumes that all cash flows can be reinvested to earn [...]
Answer
exactly 6%.
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#reading-7-discounted-cashflows-applications
Question
A project with an IRR of 6% assumes that all cash flows can be reinvested to earn [...]
Answer
?
Tags
#reading-7-discounted-cashflows-applications
Question
A project with an IRR of 6% assumes that all cash flows can be reinvested to earn [...]
Answer
exactly 6%.
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Subject 1. NPV and IRR y a capital investment. As such, it is an easy number to interpret and understand. However, calculation of the IRR assumes that all project cash flows can be reinvested to earn a rate of return exactly equal to the IRR itself. In other words, <span>a project with an IRR of 6% assumes that all cash flows can be reinvested to earn exactly 6%. If the cash flows are invested at a rate lower than 6%, the realized return will be less than the IRR. If the cash flows are invested at a rate higher than 6%, the realized return will
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