1. New equipment costing $5,000 is expected to produce net cash savings of $1,250 in operating costs each year for the next five years. What is the approximate internal rate of return?

2. What is the present value to you of a series of payments as follows: $1,200 per year at the end of each of the next 5 years and $500 at the end of 5 years?

3. New equipment costing $5,000 is expected to produce net cash savings of $1,250 in operating costs each year for the next five years. Assuming a required rate of return of 10%, should the equipment be purchased based on NPV?

New equipment costing $5,000 is expected to produce net cash savings of $1,250 in operating costs each year for the next five years. What is the approximate internal rate of return?