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14) please highlight the answer and type it Your factory has been offered a contract to produce a part for a new printer. The contract
14) please highlight the answer and type it
Your factory has been offered a contract to produce a part for a new printer. The contract would last for three years, and your cash flows from the contract would be $5.04 million per year. Your upfront setup costs to be ready to produce the part would be $8.05 million. Your discount rate for this contract is 8.5%. a. What is the IRR? b. The NPV is $4.82 million, which is positive so the NPV rule says to accept the project. Does the IRR rule agree with the NPV rule? a. What is the IRR? The IRR is \%. (Round to two decimal places.) b. The NPV is $4.82 million, which is positive so the NPV rule says to accept the project. Does the IRR rule agree with the NPV rule? (Select from the drop-down menu.) The IRR rule with the NPV ruleStep by Step Solution
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