Essentials Of Investments
Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Compute the IRR statistic for Project E. The appropriate cost of capital is 9 percent. (Do not round intermediate calculations and
round your final answer to 2 decimal places.)
Project E
Time:
Cash flow
IRR
0
-$3,500
1
$1,150
%
2
3
$1,080 $920
4
$700
5
$500
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Transcribed Image Text:Compute the IRR statistic for Project E. The appropriate cost of capital is 9 percent. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project E Time: Cash flow IRR 0 -$3,500 1 $1,150 % 2 3 $1,080 $920 4 $700 5 $500
Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of
this risk class is 13 percent, and that the maximum allowable payback and discounted payback statistics for your company are 2.5 and
3.0 years, respectively.
Time:
Cash flow:
0
1
2
3
4
5
-$345,000 $64,900 $83,100 $140,100 $121,100 $80,300
Use the IRR decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal
places.)
IRR
%
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Transcribed Image Text:Suppose your firm is considering investing in a project with the cash flows shown below, that the required rate of return on projects of this risk class is 13 percent, and that the maximum allowable payback and discounted payback statistics for your company are 2.5 and 3.0 years, respectively. Time: Cash flow: 0 1 2 3 4 5 -$345,000 $64,900 $83,100 $140,100 $121,100 $80,300 Use the IRR decision rule to evaluate this project. (Do not round intermediate calculations and round your final answer to 2 decimal places.) IRR %
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