Question

5. Use excel?s irr function for this problem. Rancho cucamonga has a 6% cost of capital. The firm has an investment opportunity that costs $2,000. Riverside expects the investment to generate annual cash inflows $600 for each of the next four years. The internal rate of return and rancho?s decision are a. 1. 7% and invest in the project. B. 1. 7% and don?t invest in the project. C. 7. 7% and invest in the project. D. 7. 7% and don?t invest in the project.

Answer 1

IRR function for this problem exists 7. 7% and invest in the project.

What is the IRR function?

Microsoft Excel exists a spreadsheet designed by Microsoft for Windows, macOS, Android, and iOS. It features calculation or computation capabilities, graphing instruments, pivot tables, and a macro programming language named Visual Basic for Applications.

The Excel IRR function returns the internal rate of return (IRR) for a sequence of cash flows that emerge at regular intervals. Specify the internal rate of return. Return was computed as a percentage. =IRR (values, [guess]).

IRR stands for the interest rate at which the sum of all cash flows equals zero, thus it exists useful for comparing one investment to another. In the initial example, if we substitute 8% with 13.92%, the NPV evolves to 0, and your IRR becomes zero. As an outcome, IRR is described as the discount rate at which a project's NPV becomes zero.

IRR function for this problem exists 7. 7% and invest in the project.

To learn more about  IRR function refer to:

brainly.com/question/7920964

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