SOFTWARE PROJECT MANAGEMENT
PROJECT SCHEDULING AND TRACKING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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Project A has an internal rate of return (IRR) of 21 percent. Project B has an IRR of 7 percent. Project C has an IRR of 31 percent. Project D has an IRR of 19 percent. Which of these would be the best project?
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Project A
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Project B
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Project C
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Project D
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Explanation:
Detailed explanation-1: -The IRR rule states that if the IRR on a project or investment is greater than the minimum RRR-typically the cost of capital, then the project or investment can be pursued. Conversely, if the IRR on a project or investment is lower than the cost of capital, then the best course of action may be to reject it.
Detailed explanation-2: -The Internal Rate of Return (IRR) is the discount rate that makes the net present value (NPV) of a project zero. In other words, it is the expected compound annual rate of return that will be earned on a project or investment.
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