Discount rate that causes a project to have a net present value of zero used to rank projects in comparison with market rates of interest?
Correct answer: B. Internal rate or returns
- A. Rate or returns
- B. Internal rate or returns
- C. External rate or returns
- D. None
Explanation
The internal rate of return is the discount rate at which a project's net present value becomes zero, and it can be compared with the market interest rate. A higher internal rate of return generally indicates a more attractive project, subject to other conditions.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
Practise Agricultural Economics and Extension
190 free Agricultural Economics and Extension MCQs from Agriculture, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Agriculture questions like this
Agriculture is on this paper prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for it.
More Agricultural Economics and Extension questions
A deliberate effort to replace major consumer imports by promoting the emergence and expansion of domestic industries such as textile, shoes etc ?
Productive investments embodied in human persons?
Monopoly and oligopoly are the examples of___________________?
Proportion of school aged children who don't complete a particular school cycle ?
The principle that if one factor of production is fixed and constant addition of other factors are combined with it, the marginal productivity of variable factors will eventually decline ?
The determination by the state, of what shall be produced and how factors of production shall be allocated among different uses ?