Internal Rate of Return (IRR) Method in Capital Budgeting Decisions

Internal Rate of Return (IRR) Method in Capital Budgeting Decisions is the rate of return promised by an investment project over its useful life. It is some time referred to simply as yield on project. The internal rate of return is computed by finding the discount rate that equates the present value of a project’s cash out flow with the present value of its cash inflow In other words,Internal Rate of Return (IRR) Method in Capital Budgeting Decisions is that discount rate that will cause the net present value of a project to be equal to zero.