Question

Compute the IRR for Project F. The appropriate cost of capital is 12 percent. (Do not round intermediate calculations and round your final answer to 2 decimal places.) Project F Time: 0 1 2 3 4 Cash flow: –$11,800 $4,250 $5,080 $2,420 $3,050

Answer 1

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

11,800=4,250/1.0x+5,080/1.0x^2+2,420/1.0x^3+3,050/1.0x^4

Hence x=irr=10.70%(Approx).