Basic IRR Rule

Business, Legal & Accounting Glossary

Definition: Basic IRR Rule


Basic IRR Rule


Full Definition of Basic IRR Rule


A rule of thumb that states that an individual or a company should conduct a project or make an investment if the internal rate of return exceeds the discount rate. Therefore, an individual should only participate in the activity if the discount value of the cash inflows will exceed cash outflows. Thus, accept the project if the IRR is higher than the discount rate and reject the project if it is lower than the discount rate.


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Definition Sources


Definitions for Basic IRR Rule are sourced/syndicated and enhanced from:

  • A Dictionary of Economics (Oxford Quick Reference)
  • Oxford Dictionary Of Accounting
  • Oxford Dictionary Of Business & Management

This glossary post was last updated: 20th November, 2021 | 0 Views.