Discounted cash flow analysis techniques are used by managers to understand the impact of investment decisions in terms of todays dollars Two common techniques that use discounted cash flows are net present value (NPV) and internal rate of return (IRR) Like most analysis techniques, each of these methods requires us to make certain assumptions Required Describe the assumptions underlying NPV and IRR

Question: Discounted cash flow analysis techniques are used by managers to understand the impact of investment decisions in terms of todays dollars. Two common techniques that

Discounted cash flow analysis techniques are used by managers to understand the impact of investment decisions in terms of “today’s dollars.” Two common techniques that use are (NPV) and (IRR). Like most analysis techniques, each of these methods requires us to make certain assumptions.

Required
Describe the assumptions underlying NPV and IRR.

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