A company that makes clutch disks for race cars had the cash flows shown for one department.

Question:

a. Calculate the internal rate of return.

b. Calculate the external rate of return using the ROIC method with a reinvestment rate of 15%

per year.

c. Calculate the external rate of return using the MIRR method with a reinvestment rate of 15%
per year and a borrowing rate of 8% per year.

d. Rework parts

(b) and

(c) using a spreadsheet.

Year Cash Flow, $1000 0 65 1 30 2 84 3 10 4 12

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Basics Of Engineering Economy

ISBN: 9780073376356

2nd Edition

Authors: Leland T. Blank, Anthony Tarquin

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Question Posted: Oct 26, 2024 07:00 AM

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A company that makes clutch disks for race cars had the cash flows shown for one department.

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Basics Of Engineering Economy

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