erez Company is considering an investment of $26,945 that provides net cash flows of $8,500 annually for four years. (a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (b) The hurdle rate is 7%. Should the company invest in this project on the basis of internal rate of return?
erez Company is considering an investment of $26,945 that provides net cash flows of $8,500 annually for four years. (a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided. Round your present value factor to 4 decimals.) (b) The hurdle rate is 7%. Should the company invest in this project on the basis of internal rate of return?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Perez Company is considering an investment of $26,945 that provides net cash flows of $8,500 annually for four years.
(a) What is the internal rate of
(b) The hurdle rate is 7%. Should the company invest in this project on the basis of internal rate of return?
Transcribed Image Text:What is the internal rate of return of this investment?
Present value factor
Internal rate of return
%
Transcribed Image Text:Perez Company is considering an investment of $26,945 that provides net cash flows of $8,500 annually for four years.
(a) What is the internal rate of return of this investment? (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from
the tables provided. Round your present value factor to 4 decimals.)
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