Question
Garfield Motors is evaluating a project that would require an initial investment of 80,872 dollars today. The project is expected to produce annual cash flows
Garfield Motors is evaluating a project that would require an initial investment of 80,872 dollars today. The project is expected to produce annual cash flows of 6,903 dollars each year forever with the first annual cash flow expected in 1 year. The NPV of the project is 306 dollars. What is the IRR of the project? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098. They are also evaluating a project that would last for 4 years. The projects internal rate of return is 9.62 percent; its NPV is 1,500 dollars; and the expected cash flows are -73,100 dollars at time 0, 13,500 dollars in 1 year, 59,600 dollars in 3 years, and X in 4 years. What is X? What is the internal rate of return if they begin a project that is expected to cost 5,590 dollars today; produce a cash flow of 6,792.46 dollars in 3 years; and have a net present value of -412.24 dollars? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
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