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IRR, investment life, and cash inflows Oak Enterprises accepts projects earning more than the firm's 14% cost of capital. Oak $100 200 currently considering a
IRR, investment life, and cash inflows Oak Enterprises accepts projects earning more than the firm's 14% cost of capital. Oak $100 200 currently considering a 10-year project that provides annual cash inflows of $15,000 and requires an initial investment of a. Determine the IRR of this project. Is it acceptable? b. Assuming that the cash inflows continue to be $15,000 per year, how many additional years would the flows have to continue to make the project acceptable that is, to make it have an IRR of 14%)? c. With the given life, an initial investment of $100, 200, and cost of capital of 14%, what is the minimum annual cash inflow the investment would have to provide in order for this project to make sense for Oak's shareholders
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