Hildegard, an intelligent and charming Holstein cow, grazes in a very large, mostly barren pasture with a few patches of lush gr
ass. When she finds a new grassy area, the amount of grass she gets from it is equal to the square root of the number of hours, h, that she spends grazing there. Finding a new patch of grass on which to graze takes her 1 hour. Since Hildegard does not have pockets, the currency in which her costs are measured is time. (a) What is the total cost to Hildegard of finding a new patch of grass and getting y units of grass from it? (b) Find an expression for her marginal and her average costs per patch of grass as a function of the amount of grass she gets from each patch. (c) How much time would she spend in each patch if she wanted to maximize her food intake? (Hint: Minimize the average cost per unit of grass eaten.)
1 answer:
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Answer: 14.59%
Explanation:
The Internal Rate of Return(IRR) is the discount rate that brings the Net Present Value to zero. It is used to decide the viability of projects. The project is generally considered viable if the Cost of capital is less than the IRR.
You can use Excel to calculate the IRR;
= IRR(-15,800,6,500,7,800,6,300)
From the picture attached you can see that the IRR is 14.59%
