Determine the internal rate of return on the following project: An initial outlay of $10,000 resulting in a cash inflow of $2,000 at the end of year 1, $5,000 at the end of year 2, and $8,000 at the end of year 3.

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter12: Capital Budgeting: Decision Criteria
Section: Chapter Questions
Problem 1P: A project has an initial cost of 40,000, expected net cash inflows of 9,000 per year for 7 years,...
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(Related to Checkpoint 11.4) (IRR calculation) Determine the internal rate of return on the following project: An initial outlay of $10,000 resulting in a cash inflow of $2,000 at the end of year 1, $5,000 at the end of year 2, and $8,000 at the end of year 3.
This project's internal rate of return is %. (Round to two decimal places.)
C
Transcribed Image Text:(Related to Checkpoint 11.4) (IRR calculation) Determine the internal rate of return on the following project: An initial outlay of $10,000 resulting in a cash inflow of $2,000 at the end of year 1, $5,000 at the end of year 2, and $8,000 at the end of year 3. This project's internal rate of return is %. (Round to two decimal places.) C
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