Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Transcribed Image Text:Suppose you are offered a project with the following cash flows:
Year Cash Flows
0
1
2
3
4
$8,800
-4,800
-3,500
-2,600
-1,400
a. What is the IRR of this offer? (Do not round intermediate calculations and enter your
answer as a percent rounded to 2 decimal places, e.g., 32.16.)
IRR
%
O Accept
O Reject
☆
b. If the appropriate discount rate is 13 percent, should you accept this offer?
c. If the appropriate discount rate is 25 percent, should you accept this offer?
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