ear 0 1 2 3 4 5 Cash Flow -$ 28,900 11,100 13,800 15,700 12,800 -9,300 e company uses a discount rate of 13 percent and a reinvestment rate of 6 percent on of its projects. Calculate the MIRR of the project using the discounting approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Calculate the MIRR of the project using the reinvestment approach (Do not round

Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
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Duo Corporation is evaluating a project with the following cash flows:
Cash Flow
Year
0
WNIO
1
2
3
4
5
-$ 28,900
11,100
13,800
15,700
12,800
-9,300
The company uses a discount rate of 13 percent and a reinvestment rate of 6 percent on
all of its projects.
a. Calculate the MIRR of the project using the discounting approach. (Do not round
intermediate calculations and enter your answer as a percent rounded to 2
decimal places, e.g., 32.16.)
b. Calculate the MIRR of the project using the reinvestment approach. (Do not round
intermediate calculations and enter your answer as a percent rounded to 2
decimal places, e.g., 32.16.)
c. Calculate the MIRR of the project using the combination approach. (Do not round
intermediate calculations and enter your answer as a percent rounded to 2
decimal places, e.g., 32.16.)
a. Discounting approach MIRR
b. Reinvestment approach MIRR
c. Combination approach MIRR
%
%
%
Transcribed Image Text:Duo Corporation is evaluating a project with the following cash flows: Cash Flow Year 0 WNIO 1 2 3 4 5 -$ 28,900 11,100 13,800 15,700 12,800 -9,300 The company uses a discount rate of 13 percent and a reinvestment rate of 6 percent on all of its projects. a. Calculate the MIRR of the project using the discounting approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the MIRR of the project using the reinvestment approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. Calculate the MIRR of the project using the combination approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Discounting approach MIRR b. Reinvestment approach MIRR c. Combination approach MIRR % % %
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