Title

Teaching MIRR to Improve Comprehension of Investment Performance Evaluation Techniques: A Comment

Document Type

Article

Publication Date

Winter 2013

Publication Title

Journal of Economics and Finance Education

Abstract

Balyeat, et. al. (2013, this journal) suggest that IRR does not have a clear economic interpretation and that MIRR highlights the reinvestment assumptions of NPV and IRR thus increasing its value as a teaching tool. This comment addresses misconceptions found in the work of Balyeat, et. al. In particular, it reiterates the economic interpretation of IRR and reexamines the alleged reinvestment rate assumptions.

Share

COinS