Question

Following is information on two alternative investments being considered by Jolee Company. The company requires a 10% return from its investments. Project A Project B Initial investment $ (160,000 ) $ (105,000 ) Expected net cash flows in year: 1 40,000 32,000 2 56,000 50,000 3 80,295 66,000 4 90,400 72,000 5 65,000 24,000 Compute the internal rate of return for each of the projects using excel functions.

Answer 1

Answer:

Project A = 27%

Project B = 35%

Explanation:

See the images below to get the appropriate Internal Rate Return (IRR) with the help of Excel function: