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Iggy Company is considering three capital expenditure projects. Relevant data for the projects are as follows. Project Investment Annual Income Life of Project 22A $244,500

Iggy Company is considering three capital expenditure projects. Relevant data for the projects are as follows.

Project Investment Annual Income Life of Project

22A

$244,500 $17,490 6 years

23A

274,400 20,770 9 years

24A

282,900 15,700 7 years

Annual income is constant over the life of the project. Each project is expected to have zero salvage value at the end of the project. Iggy Company uses the straight-line method of depreciation. Click here to view PV table. (a) Determine the internal rate of return for each project. (Round answers 0 decimal places, e.g. 13%. For calculation purposes, use 5 decimal places as displayed in the factor table provided.)

Project Internal Rate of Return

22A

enter percentages rounded to 0 decimal places %

23A

enter percentages rounded to 0 decimal places %

24A

enter percentages rounded to 0 decimal places %

(b) If Iggy Companys required rate of return is 11%, which projects are acceptable?

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