The internal rate of return is that discount rate that equates the present value of the cash outflows (or costs) with the present value of the cash inflows. True or False

It is TRUE that the internal rate of return is the discount rate that equates the present values of cash outflows with cash inflows.

The IRR (Internal Rate of Return) is obtained by finding a discount rate that makes the net present value (NPV) of all cash flows equal to zero. The calculation of IRR uses the same formula as the NPV.

Thus, it is true that the internal rate of return (IRR) discounts the present values of cash inflows and equates them to the present values of the cash outflows for the project.

Learn more about the internal rate of return (IRR) here: link

True

Explanation:

The internal rate of return defines that return in which the net present value is zero that means the initial investment is equivalent to the present value of the yearly cash flows after considering the discounting factor

In other words we can say that the net present value is zero

Hence, the given statement is true

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