G V GI QC C V MF F PH G c Cx MIC C CTG C CAC1CFC MIG C C ilm/takeAssignment/takeAssignmentMain.do?invoker-assignments&takeAssignmentSessionLocator assignment-take&inprogress false eBook Show Me How Calculator Internal Rate of Return Method The internal rate of return method is used by Testerman Construction Co. in analyzing a capital expenditure proposal that involves an investment of $113,550 and annual net cash flows of $30,000 for each of the six years of its Present Value of an Annuity of $1 at Compound Interest Year 6% 10% 12% 15% 20% 1 0.943 0.909 0.893 0.870 0.833 2 1.833 1.736 1.690 1.626 1.528 2.673 2.487 2.402 2.283 2.106 4 3.465 3.170 3.037 2.855 2.589 4.212 3.791 3.605 3.352 2.991 6 4.917 4.355 4.111 3.784 3.326 7 5.582 4.868 4.564 4.160 3.605 6.210 5.335 4.968 4.487 3.837 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 a. Determine a present value factor for an annuity of $1, which can be used in determining the internal rate of return. If required, round your answer to three decimal places. 3,784 X b. Using the factor determined in part (a) and the present value of an annuity of $1 table above, determine the internal rate of return for the proposal. 15 Fesdback T Cheak My Work a & b: Divide the amount to be invested by the annual net cash flow. In Exhibit 5, find the rate closest to this factor for six periods .OUG 4.384 4.160 3.605 6.210 5.335 4.968 4.487 3.837 6.802 5.759 5.328 4.772 4.031 10 7.360 6.145 5.650 5.019 4.192 a. Determine a present value factor for an annuity of $1, which can be used in determining the internal rate of return. If required, round your answer to three decimal places. 3,784 X b. Using the factor determined in part (a) and the present value of an annuity of $1 table above, determine the internal rate of return for the proposal. 15 9% Feedback T Check My Work a & b: Divide the amount to be invested by the annual net cash flow. In Exhibit 5, find the rate closest to this factor for six periods. Learning Objective 3. Check My Work All work saved