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MIRR

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AFM Exams › MIRR

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  • May 11, 2014 at 10:47 am #168305
    unsworth
    Member
    • Topics: 6
    • Replies: 5
    • ☆

    Dear Sir,

    Can you please explain about the drawbacks of MIRR?

    Thanks

    May 11, 2014 at 12:15 pm #168321
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54480
    • ☆☆☆☆☆

    MIRR assumes that the proceeds are re-invested at the cost of capital.
    In practice this is unlikely – more likely they will be re-invested elsewhere at a higher rate.

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