If an investor receives a 15% IRR, what does this indicate?

Receiving a 15% IRR (Internal Rate of Return) indicates that the investment has increased in value at an average rate of 15% per year. The IRR is a measure of the profitability of potential investments, representing the discount rate that makes the net present value (NPV) of all cash flows from a particular investment equal to zero. A 15% IRR signifies that, over the duration of the investment, it is expected to yield a return that compounds annually at that rate, reflecting the average annual growth rate of the investment over time.

This concept of IRR allows investors to gauge the effectiveness of their investments against other potential opportunities. In this case, a 15% IRR suggests that the investment has been both profitable and efficient in generating returns.

Other options imply either a static or negative performance of the investment, which does not align with a positive IRR; therefore, they do not accurately reflect the investment's growth or viability based on the information provided.