Question

what the problem and tricks when calculate IRR?

Answer 1

Tricks :

1) for irr calculation there should be 2 discounting factor ,

One should be lowest discounting factor and other should be higher discounting factor to gave a negative net present value.

2) in common cases higher discounting factor should gave a negative npv

3) the decision rule is that when irr is greater than wacc , then project will be acceptable m