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OPQ Enterprises is looking at a new project which involves an initial outlay of $400,000. The net cash inflows for the next five years are
OPQ Enterprises is looking at a new project which involves an initial outlay of $400,000. The net cash inflows for the next five years are expected to be:
- Year 1: $90,000
- Year 2: $100,000
- Year 3: $110,000
- Year 4: $120,000
- Year 5: $130,000
Requirements:
- Calculate the Accounting Rate of Return (ARR).
- Determine the Payback Period.
- Compute the Net Present Value (NPV) at a discount rate of 9%.
- Find the Internal Rate of Return (IRR).
- Analyze the project's financial feasibility.
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