Question

can someone please provide steps for calculating IRR on a TI Nspire CX? I can calculate npv already, but I do not know how to use the irr function on ti nspire. the problem I am stuck on is number 10.

out-content-rid-14522766-1/courses/FINC3321-002-201 920/capital%20decisions%281 %29.pdf P9-10 Your company is considering two mutually exclusive projects-C and R-whose costs and cash flows are shown in the following table: Expected Net Cash Flows Year Project CF Project R $(14,000) 8,000 6,000 2,000 3,000 $(22,840) 8,000 8,000 8,000 8,000 2 4 The projects are equally risky, and their required rate of return is 12 percent. You must make a recommendation concerning which project should be purchased. To determine which is more ap compute the NPV and IRR of each project. propriate P9-11 The after-tax cash flows for two mutually exclusive projects have been estimated, and the following information has been provided Expected Net Cash Flows Machine Q Machine D 2 500 Year のe

thank you

Answer 1

Calculation of NPV of projects
Year	Discount Factor @ 12%	Project C		Project R
		Cash flow	Present Value	Cash flow	Present Value
0	1.00000	-$14,000.00	-$14,000.00	-$22,840.00	-$22,840.00
1	0.89286	$8,000.00	$7,142.86	$8,000.00	$7,142.86
2	0.79719	$6,000.00	$4,783.16	$8,000.00	$6,377.55
3	0.71178	$2,000.00	$1,423.56	$8,000.00	$5,694.24
4	0.63552	$3,000.00	$1,906.55	$8,000.00	$5,084.14
NPV			$1,256.14		$1,458.79
Project	NPV
C	$1,256.14
R	$1,458.79
Calculation of IRR of project
We can use the IRR excel formula to calculate the same.
At IRR , the NPV of project is equal to zero.
Project	IRR
C	17.32%
R	15.00%
IRR method is most appropriate than NPV method when both the projects are equally risky.
Hence , I would suggest the project C should be purchased as it has higher IRR.