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MC algo $10-33$ Cash Flows And IRR

Cirice Corporation is considering opening a branch in another state. The operating cash flow will be $$210,600$ a year. The project will require new equipment costing $$595,000$ that would be depreciated on a straight$-$line basis to zero over the $4-$year life of the project. The equipment will have a market value of $$179,000$ at the end of the project. The project requires an initial investment of $$41,500$ in net working capital, which will be recovered at the end of the project. The tax rate is $21$ percent. What is the project's IRR?

Multiple Choice

$20\mathrm{.}59\%$

$14\mathrm{.}13\%$

$19\mathrm{.}77\%$

$17\mathrm{.}32\%$