Answer:
14.23%
Explanation:
Internal rate of return is the discount rate that equates the after-tax cash flows from an investment to the amount invested
IRR can be calculated with a financial calculator
Cash flow in year 0 = –$ 33,000
Cash flow in year 1 = 13,400
Cash flow in year 2 = 18,300
Cash flow in year 3 = 10,800
IRR = 14.23%
To find the IRR using a financial calculator:
1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.
2. After inputting all the cash flows, press the IRR button and then press the compute button.
False is correct answer.
Hope it helped you.
-Charlie
Answer:
Stream A
Present Values 0 141.51 311.50 293.87 277.23 186.81
Stream B
Present Values 0 235.85 311.50 293.87 277.23 112.10
At 0% The streams will remain as given as they will not be discounted at all.
Explanation:
Stream A
Cashflows 0 150 350 350 350 250
Disc Factor @ 6% 1 0.94 0.89 0.84 0.79 0.75
Present Values 0 141.51 311.50 293.87 277.23 186.81
Stream B
Cashflows 0 250 350 350 350 150
Disc Factor @ 6% 1 0.94 0.89 0.84 0.79 0.75
Present Values 0 235.85 311.50 293.87 277.23 112.10
