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The break-even value calculation is similar to the calculation we use for theinternal rate of return. True or false?

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 17Q: What is the difference between the discount rate used for net present value and the internal rate of...

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Question

The break-even value calculation is similar to the calculation we use for the
internal rate of return. True or false?

Definition Definition Discount rate of a project wherein its net present value equals zero. Internal rate of return equates the present value of future cash flows with the initial investments. Internal rate of return helps to determine nominal cash flows.

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