4. Modified internal rate of return (MIRA) The IRR evaluation method assumes that cash flows from the projec are reinvested at the same rate equal to the IRR. However, in reality the reinvested cach flows may not necessanly generate a retum equal to the IRR. Thus, the modified IRR approach makes a mare reasonable assumption other than the project's IPA. Consider the following stuation: Cute Camel Woodcroft Company is analyz.eg a project that reauires an inital investmeat of 52,750,000 : the project 3 expected cash fiows are: Cute Camel Woodcraft Company's WACC is 5%, and the project has the same nisk as the firm ir average project. Calculate this project is modfied internal rate of return (MIPR): 23,47% 16.374 20.12% 24.59\% If Cute Camei Wooderaft Company's managers seleat projests based on the MIRR critenos, they shaved Which of the following statenients about the relationship between the IAR and the MTRR is GSrect? A tripicai firm's 19 wh be eque to its Mink. A typ cal firm's IRR. will be less than its Miar. A troice firm I IRA wil be greater than it MIPA