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ABC Cutlery, Inc. forecasts the following cash flows on a project under consideration. ABC uses the IRR rule to accept or rejects projects. C0 C1

ABC Cutlery, Inc. forecasts the following cash flows on a project under consideration. ABC uses the IRR rule to accept or rejects projects.

C0 C1 C2 C3
-$10,000 0 +$7,500 +$8,500
  1. What is the project's IRR?
  2. Should this project be accepted if the required rate of return is 12%?

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