The Firm Has Computed the Net Present Value of the Two-Period

Multiple Choice

The firm has computed the net present value of the two-period project to be negative. What does this mean about the internal rate of return?

A) Internal rate of return is smaller than the discount rate.
B) Internal rate of return is greater than the discount rate.
C) Internal rate of return equals the discount rate.
D) Not enough information to say anything about IRR.