Well-Behaved Cash Flows

Alexander Saak () and David Hennessy

Staff General Research Papers Archive from Iowa State University, Department of Economics

Abstract: Internal rate of return and net present value statistics for evaluating projects may display anomalous behavior when cash flows change sign more than once. We identify necessary and sufficient conditions such that these anomalies are precluded. We also identify a linear dominance condition on payoffs sufficient to order internal rates.

Date: 2001-10-01
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Published in Economics Letters, October 2001, vol. 73, pp. 81-88

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Journal Article: Well-behaved cash flows (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:isu:genres:5111

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