A project has the following cash flows What is the IRR Year

Solution

Let the IRR be x.

Now , Present Value of Cash Outflows=Present Value of Cash Inflows

89,300 = 32,900 /(1.0x) + 64,200 / (1.0x)^2 + 5,800/ (1.0x)^3

Or x= 8.57%

Hence the IRR is 8.57%