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Welcome to the Opentuition forums. I think it depends on the specific question at hand. I think a typical example would be the percentage points by which interest rates would have to increase in order for NPV to go to zero. This zero could be worked out using IRR. I would encourage you to watch the videos and read the notes designed to be used in conjunction with the lectures on this site. Hope this helps.
It is easy:
= (IRR – r) / r × 100%
It means that the discount rate can increase by up to that % before NPV becomes negative.
Also, the sensitivity is on discount rate, not discount factor.You might also want to obtain a practice and revision kit for exam preparation and revision from an approved publisher. Kaplan and BPP are approved publishers.
You can obtain a twenty percent discount on BPP books with this site-
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