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Good day Mr John,
I seem to be confused as to how the discount rates are chosen in IRR calculations, particularly when they’re not given as in WACC section C questions. How does one determine which 2 DF’s to use ?
Thank yiuAs I explain in my lectures, you can use any two discount rates to arrive at an approximation to the IRR.
Do appreciate however that for Section C questions you have the spreadsheet available and you can use the IRR function in the spreadsheet to calculate the IRR without having to make two guesses.
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