Basic IRR Rule

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Basic IRR rule

Accept the project if IRR is higher than the discount rate; reject the project if it is lower than the discount rate. It is wise to also consider net present value for project evaluation.

Basic IRR Rule

A rule of thumb stating that a person or company should conduct a project or make an investment if the internal rate of return exceeds the discount rate. That is, one should only do an activity if the discount value of the cash inflows exceeds cash outflows.

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