Question
GTO Incorporated is considering an investment costing $298,260 that results in net cash flows of $45,000 annually for 14 years. (PV of $1, FV of
GTO Incorporated is considering an investment costing $298,260 that results in net cash flows of $45,000 annually for 14 years. (PV of $1, FV of $1, PVA of $1, and FVA of $1) (Use appropriate factor(s) from the tables provided.)
(a) What is the internal rate of return of this investment? (b) The hurdle rate is 12.5%. Should the company invest in this project on the basis of internal rate of return?
% a. Internal rate of return b. Should the company invest in this project on the basis of internal rate of return
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
1111972516, 978-1285586618, 1285586611, 978-1285613109, 978-1111972516
