Question: One problem with the IRR method is that: it does not take account of cash flows over a projects full life. it does not take

One problem with the IRR method is that:
it does not take account of cash flows over a projects full life.
it does not take account of the cash outflows.
it does not provide a rate of return.
it values a dollar received today the same as a dollar that will not be received until sometime in the future.
it assumes that the cash flows generated by a project can be reinvested back into the same project, and this assumption is often not valid.

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!