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If the net present value (NPV) is positive when an investment is discounted at 12%, we...

If the net present value (NPV) is positive when an investment is discounted at 12%, we know that the internal rate of return (IRR) is:

1.

Less than 12%
2.

Equal to 12%
3.

Greater than 12%
4.

Greater than 0%
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Answer #1

Answer :3) Greater than 12%

At IRR Net Present Value of the Project Will be Zero,at 12% Still we have the Positive NPV so IRR is more than 12%

Conditions:

At Discounting rate r

IF NPV = 0 , IRR = r

IF NPV = Positive , IRR >r

IF NPV = Negative , IRR <r

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