If the internal rate of return on a project is 11.24%, and the project is assigned a 9.5% discount rate, then the project will have a negative net present value.

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Hashim Muhammed · Accepted Answer

Final Answer : False, Explanation :  The internal rate of return (IRR) is the discount rate at which the net present value (NPV) of all the cash flows (both positive and negative) from a project or investment equals zero. If the IRR is higher than the project's discount rate, it means the project is expected to generate a return higher than the discount rate, thus resulting in a positive NPV. Therefore, with an IRR of 11.24% against a discount rate of 9.5%, the project would have a positive NPV, not negative.

If the internal rate of return on a project is 11.24%, and the project is assigned a 9.5% discount rate, then the project will have a negative net present value.

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