Compute the IRR for Project F. The appropriate cost of capital is 13 percent. (Do not...

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Compute the IRR for Project F. The appropriate cost of capital is 13 percent. (Do not round intermediate calculations and rou

business finance

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Answer 1

Answer #1

Let irr be x%
At irr,present value of inflows=present value of outflows.

10200=3900/1.0x+4730/1.0x^2+2070/1.0x^3+2700/1.0x^4

Hence x=irr=13.24%(Approx).

Hence since irr is greater than cost of capital;project must be accepted.

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Answer 2

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