1. The internal rate of return is often referred to as the yield on an investment. Explain the analogy between the internal rate of return on an investment and the yield to maturity on a bond.
2. The net present value method and the internal rate of return method may produce different decisions when selecting among mutually exclusive projects. What is the source of this conflict?
3. The modified internal rate of return is designed to overcome a deficiency in the internal rate of return method. Specifically, what problem is the MIRR designed to overcome?