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A Moving to the next question prevents changes to this answer
A Moving to the next question prevents changes to this answer. Question 1 The increase in the margin between the IRR and the MARR will reflect that The project carries less risk because the IRR is much greater than the MARR The IRR cannot be accepted for the project There is no difference between the IRR and the MARR The project carries higher risks because the MARR is much lower than the IRR A Moving to the next question prevents changes to this answer P
Expert Solution
Internal rate of return(IRR) it is measure of the percentage yield on investment.Minimum acceptable rate of return(MARR) it is minimum acceptable rate of return from an investment it is also called hurdle rate. If the margin between IRR and MARR increased it reflects that the project carres less risk because percentage yield on investment(IRR) is greater than minimum acceptable rate of return from an investment so project is economical.
- In the case when IRR lessthan MARR investment is uneconomical
- If IRR equal to MARR investments benefit iwill be equal to its cost
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