Internal Rate of Return: Advantages & Disadvantages


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1. What is the internal rate of return (IRR)?

2. What is an advantage of the internal rate of return?

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About This Quiz & Worksheet

The quiz and worksheet are tools that help test your familiarity with internal rate of return. The pros and cons of this return are topics covered on the quiz.

Quiz & Worksheet Goals

These educational resources help check your understanding of:

  • Advantages and disadvantages of the internal rate of return
  • Meaning of IRR
  • How IRR is used for business leaders

Skills Practiced

  • Information recall - access the knowledge you have gained regarding the definition of IRR
  • Knowledge application - use your knowledge to answer questions about the pros and cons of IRR
  • Interpreting information - verify that you can read information about business leaders using IRR and interpret it correctly

Additional Learning

You can learn more about this rate of return using the lesson, Internal Rate of Return: Advantages & Disadvantages. This lesson helps you:

  • Determine why IRR is used
  • See how companies use the internal rate of return
  • Identify the pros and cons of this return