How relationship reflect the risk-return trade-off principle


Question 1: Would the projects that have a higher IRR pose greater risk over time? How does the IRR play a role in the risk assessment of a particular project?

Question 2: With respect to those projects with higher individual IRR's, how does this impact the outcome of their financing decisions? What is the relationship of risk associated with a higher IRR? How does this relationship reflect the 'Risk-Return Trade-Off' principle ?

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Finance Basics: How relationship reflect the risk-return trade-off principle
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