4) A firm considers to buy a new 3D printer whose cost is $ 46 100. The cost of 3D printer will be paid in 2020. The expected cash flows of this investment are as follows:

2021: $ 13 200

2022: $ 13 200

2023: $ 13 200

2024: $ 13 200

2025: $ 13 200

The firm plans to sell this 3D printer at the end of 2025 and expects that it can sell the 3D printer in the market for $ 20 000 (the salvage value of the 3D printer is $ 20 000)

a) Find the Internal Rate of Return (IRR) of this project.

b) Given that the current annual interest rate is 15% and the risk premium appropriate for this investment is 5%; should the firm accept or reject this investment.

Note: If you do not have access to a sophisticated calculator or Excel which you need to provide a numerical answer; write the relevant formula for IRR. If your formula is correct; you receive full grade for question 4a. Write the decision criteria according to which we accept or reject an investment on basis of IRR (e.g write something like a>b specifying what a is and what b is) to get full credit for 4b in case you are unable to calculate the IRR.

Hello there. I don't want your answers with the excel solution. I want it in word or handwriting. Thank you. Hodja does not accept with excel.