1 3 2.106 Internal Rate of Return Method The internal rate of return method is used by Testerman Construction Co. in analyzing a capital expenditure proposal that involves an investment of $113.550 and annual net cash flows of $30,000 for each of the six years of its useful life. Present Value of an Annuity of si at Compound Interest Year 10% 12% 15% 20% 0.943 0.909 0.993 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 2.673 2.487 2.402 2.283 3.465 3.170 3.037 2.855 2.589 4.212 3.791 3.605 3.353 2.99: 6 4.917 4.355 4.111 3.785 7 5.582 4.868 4.564 4.160 3.605 8 6.210 5.335 4.968 4,487 3.837 9 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 a. Determine a present value factor for an annuity of $1, which can be used in determining the internal rate of return. It required, round your answer to three decimal places. 4 5 3.326 b. Using the factor determined in part (a) and the present value of an annuity of $1 table above, determine the internal rate of return for the proposal