Question
A company invests RM 1,000,000 and completes an energy efficiency project at the beginning of year 1. The firm is investing its own money and
A company invests RM 1,000,000 and completes an energy efficiency project at the beginning of year 1. The firm is investing its own money and expects an internal rate of return, IRR, of at least 26% on the constant positive annual net cash flow of RM200,000 over a period of 10 years, starting with year 1.
(i) Will the project meet the firm's expectations?
(ii) What is the IRR of this measure?
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