A project will generate annual cash flows of $237,600 for each of the next three years,...

Question

Question

business finance

Answer 1

Answer #1

Answer: The third option is correct. IRR=11.8%

Initial cost in year 0 is $748600
Cash flows are:
Year 1:$237600
Year 2:$237600
Year 3:$237600
Year 4:$274800

We can determine the internal rate of return using excel

1 Year Project Cash flows -748600 237600 237600 237600 274800 7 IRR= 11.80% 8 Formula used: IRR(B2:B6) Om +

The IRR of the project is 11.8%

Answer 2

Similar Homework Help Questions

3 SDI 2020 Saved Help Save & Exit Submit W A project will generate annual cash...

3 SDI 2020 Saved Help Save & Exit Submit W A project will generate annual cash flows of $237,600 for each of the next three years, and a cash flow of $274,800 during the fourth year. The initial cost of the project is $760,600. What is the internal rate of return of this project? 00:36:39 Multiple Choice Ο Ο Ο Ο ( 983 < Prey 8 of 20 !!! Next > DAL
help!!! Your bank will pay you an interest rate of .097 percent per week. You want...

help!!! Your bank will pay you an interest rate of .097 percent per week. You want to have $22,000 in 10 years. How much will you have to deposit today? Assume 52 weeks per year Multiple Choice $13,465.52 $13,583.64 $13,449.62 $13.288.34 $20.918.35 A project will generate annual cash flows of $237,600 for each of the next three years, and a cash flow of $274,800 during the fourth yoar. The initial cost of the project is $763,600. What is the internal...
A project is expected to generate annual cash flows of $22,500 during the next three years....

A project is expected to generate annual cash flows of $22,500 during the next three years. The initial investment of this project has 2 components: $50,000 fixed-asset investment plus $3000 working capital investment. Assume the project's opportunity cost of capital (i.e., the discount rate) is 10%. How much is the project's net present value (NPV)? A) 6,208 B) 3,508 C) 5,208 OD) 4,208 E) 2,508

A project with an initial cost of $72,400 is expected to generate annual cash flows of...

A project with an initial cost of $72,400 is expected to generate annual cash flows of $15,920 for the next 8 years. What is the project's internal rate of return?
A project with an initial cost of $68,200 is expected to generate annual cash flows of...

A project with an initial cost of $68,200 is expected to generate annual cash flows of $18,010 for the next 7 years. What is the project's internal rate of return? 20.26% 18.23% 19.75% 17.32% 16.41%
1. A project with an initial cost of $61,950 is expected to generate annual cash flows...

1. A project with an initial cost of $61,950 is expected to generate annual cash flows of $17,460 for the next 6 years. What is the project's internal rate of return? 2. Windows and More is reviewing a project with sales of 6,200 units, ±2 percent, at a sales price of $29, ±1 percent, per unit. The expected variable cost per unit is $11, ±3 percent, and the expected fixed costs are $87,000, ±1 percent. The depreciation expense is $68,000...

A project has an initial outlay of $2,396. The project will generate annual cash flows of...

A project has an initial outlay of $2,396. The project will generate annual cash flows of $593 over the 4-year life of the project and terminal cash flows of $285 in the last year of the project. If the required rate of return on the project is 11%, what is the net present value (NPV) of the project?
A project has an initial outlay of $1,522. The project will generate annual cash flows of...

A project has an initial outlay of $1,522. The project will generate annual cash flows of $485 over the 7-year life of the project and terminal cash flows of $314 in the last year of the project. If the required rate of return on the project is 13%, what is the net present value (NPV) of the project?
A project with an initial investment of $439,700 will generate equal annual cash flows over its...

A project with an initial investment of $439,700 will generate equal annual cash flows over its 10-year life. The project has a required return of 8.1 percent. What is the minimum annual cash flow required to accept the project?

A project with an initial investment of $446,900 will generate equal annual cash flows over its...

A project with an initial investment of $446,900 will generate equal annual cash flows over its 8-year life. The project has a required return of 8.7 percent. What is the minimum annual cash flow required to accept the project? $91,251.78 $76,884.10 $87,902.91 $74,321.30 $79,845.31