The minimum acceptable rate of return for an investment decision is called the a. Hurdle rate of return. d. Average rate of return. b. Payback rate of return. e. Break-even rate of return. c. Internal rate of return.

The minimum acceptable rate of return for an investment decision is called the a. Hurdle rate of return. d. Average rate of return. b. Payback rate of return. e. Break-even rate of return. c. Internal rate of return.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter11: Capital Budgeting Decisions

Section: Chapter Questions

Problem 24Q: How does the size of the initial investment affect the internal rate of return on the net present...

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Question

The minimum acceptable rate of return for an investment
decision is called the
a. Hurdle rate of return. d. Average rate of return.
b. Payback rate of return. e. Break-even rate of return.
c. Internal rate of return.

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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