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Banking System and Capital Market Questions and Answers for Competitive Exams

Q.

The internal rate of return

[A] Must be less than the interest rate if the firm is to invest
[B] Makes the present value of profits equal to the present value of costs
[C] Falls as the annual yield of an investment rises
[D] Is equal to the market interest rate for all the firm’s investment

Answer & Explanation

Answer: Option [C]

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