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Anderson International Limited is evaluating a project in Erewhon. create the following cash flows: Year 1 2 4 Cash Flow -$1,275,000 435,000 505,000 415,000
Anderson International Limited is evaluating a project in Erewhon. create the following cash flows: Year 1 2 4 Cash Flow -$1,275,000 435,000 505,000 415,000 345,000 In an attempt to improve its economy, the Erewhonian government has declared that all cash flows created by a foreign company are "blocked" and must be reinvested with the government for one year. The reinvestment rate for these funds is 4%. If the Anderson uses a required return of 12% on this project, should you accept the project or not? O Yes, because the 12% required return > 10.29% of IRR O Yes, because the IRR 15.18%>12% as the required return O No, because the IRR 10.29% 12% as the required return
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