If the sign of the cash flows for a project changes two times then the project has:

A. one IRR

B. two IRRs

C. three IRRs

D. None of the above

B. two IRRs

Explanation:

The internal rate of return is that return in which the net present value is zero, meaning that the initial investment is equal to the present value of the annual cash flows after taking into account the discount factor.

In mathematically,

NPV = 0 = Zero

It is used in the capital budgeting decision which determines the decision related to the project whether a project is accepted or not.

If the project changes for two times, then the project has two IRRs.