A project with an initial cost of 50670 is expected to gener

A project with an initial cost of $50,670 is expected to generate annual cash flows of $15,590 for the next 5 years. What is the project\'s internal rate of return?

14.69%

15.50%

18.13%

17.68%

16.32%

Let irr be x%
At irr,present value of inflows=present value of outflows.

50670=15590/1.0x+15590/1.0x^2+15590/1.0x^3+15590/1.0x^4+15590/1.0x^5

Hence x=irr=16.32%(Approx).

$A project with an initial cost of $50,670 is expected to generate annual cash flows of $15,590 for the next 5 years. What is the project\'s internal rate of ret$

A project with an initial cost of 50670 is expected to gener

Solution

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