All categories

2 years ago

What is the irr of an investment that costs $18,500 and pays $5,250 a year for 5 years?

Business

1 answer:

saveliy_v [14]2 years ago

6 0

The Internal rate of return (IRR) of an investment is found to be 13%.

<h3>What is Internal rate of return (IRR)?</h3>

The internal rate of return (IRR) is a financial analysis metric used to estimate the profitability of possible investments.

In a discounted cash flow analysis, IRR is a discount rate that renders the net present value (NPV) among all cash flows equal to zero.
IRR calculations employ the same method as NPV calculations.
Keep in mind that the IRR is not the project's actual dollar value.
The annual return is what brings the NPV to zero.

Now, according to the question;

Total investment = $18,500.

Returns = $5,250/year

Time = 5 years

Use the formula for calculation of IRR value.

$18,500 = $5,250 {[1 - 1/(1 + IRR)5] / IRR}

Simplyfying,

IRR = 12.92%

Therefore, the internal rate of returns are calculated as 13% (approximately).

To know more about internal rate of return, here

brainly.com/question/13373396

#SPJ4

You might be interested in

Which of the following is NOT be a warning sign of a scam when buying a car or other big purchases?

givi [52]

Answer:

D. A price that fits comfortably in your budget

4 0

4 years ago

The fares received by taxi drivers working for the City Taxi line are normally distributed with a mean of $12.50 and a standard

Lyrx [107]

Answer:

0.2308 or 23.08%

Explanation:

Mean (μ) = $12.50

Standard deviation (σ) = $3.25

Assuming a normal distribution, for any given fare X, the z-score is calculated as:

$z = \frac{X-\mu }{\sigma}$

For X = $15.00, the z-score is:

$z = \frac{15.00-12.50 }{3.25}\\ z=0.7692$

A z-score of 0.7692 corresponds to the 77.91-th percentile of a normal distribution. Therefore, the probability that a fare exceeds $15.00 is:

$P(X>\$15.00) = 1-0.7692 = 0.2308$

The probability that a specific fare will exceed $15.00 is 0.2308.

3 0

3 years ago

Which statement describes an hourly wage job? Each paycheck is the exact same regardless of number of hours worked. Each paychec

tangare [24]

Answer:

If an employer wants the employee to work more hours in a week, the result is a larger paycheck.

Explanation:

An hourly wage job means that you get paid according to the number of hours you work and your wage will be determined by this. If you work more hours your paycheck will be higher and if you work less hours it will be lower. According to this, the statement that describes an hourly wage job is: if an employer wants the employee to work more hours in a week, the result is a larger paycheck.

8 0

4 years ago

Lopez Corporation incurred the following costs while manufacturing its product. Materials used in product $130,300 Advertising e

Misha Larkins [42]

Answer and Explanation:

The computation is shown below

a. The cost of goods manufactured is

Materials used in product $130,300

Labor costs of assembly-line workers 116,100

Depreciation on plant 62,500

Property taxes on plant 24,300

Factory supplies used 34,000

Work in process inventory at January 1 $14,400

Less: Work in process inventory at december 1 -$17,600

Cost of goods manufactured $364,000

b. The cost of goods sold is

= Opening finished goods + cost of goods manufactured - ending finished goods

= $61,100 + $364,000 - $48,500

= $376,600

8 0

3 years ago

A federal bank examiner came to a bank in Jacksonville. He audited the books and he checked out the staff and the office facilit

babymother [125]

Answer:

Eminent domain for the public good.

Explanation:

He charged the branch manager because he didn't see eminent domain for public use.

In eminent domain the government, the government the government has the power to take private property for public use.

The bank is a public place and as such are required to have a public domain that is members of the public or for civic use. Such a party is likely going to be for public use or it could be delegated to third parties.

3 0

3 years ago