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The assumption that the cash flows from an investment project are reinvested at the company's discount rate applies to: Multiple Choice only the internal rate of return method. both the internal rate of return and the net present value methods. only the net present value method. neither the internal rate of return nor net present value methods.

Sagot :

The assumption where the cash flows from an investment project should be again reinvested at the time when the discount rate should be applied so there is a net present value method only.

The information is related to IRR is as follows:

  • IRR denotes the internal rate of return.
  • In this, the present value of cash inflows should be equivalent to the investment made.
  • The rate should be measured itself.
  • The rate should be measured by having an equation of cash inflows and cash outflows via the concept of the times value of money.

The information is related to NPV is as follows:

  • NPV denotes the net present value.
  • The present value of cash inflows that should be discounted by applying the discount rate should be decreased by the investment made.
  • The only net present value applied to the cash flow assumptions via the investment made for the project should be invested at the discount rate.

Therefore we can conclude that the assumption where the cash flows from an investment project should be again reinvested at the time when the discount rate should be applied so there is a net present value method only.

Learn more about the net present value here: brainly.com/question/7331341

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