Question
please really need help with these 3 questions with work shown Problem 3 Calculate the IRR Suppose that you are the CFO of a corporation
please really need help with these 3 questions with work shown
Problem 3 Calculate the IRR
Suppose that you are the CFO of a corporation that faces a project with the following cash flow: t=0 +$1000 t=1 -$3000
t=2 +$2500 Calculate the IRR.
A. 4.66% B. 4.70% C. 4.92% D. It is not possible to calculate the IRR (there is no real value) E. None of the above options.
Problem 4 Applying the IRR Rule
Suppose that a project has an IRR of 4%. If the rate of interest that face the corporation during the life of the project is 10%, then:
A. It is good for the corporation to accept the project. B. It is not good for the corporation to accept the project. C. With the above information we cannot know is if good or is not good. D. None of the above options.
Problem 5 Calculating the IRR
Suppose that a project has an initial investment and a payment at the end of year 1, another payment at the end of year 2, and a final investment at the end of year 3. At most, how many possible different IRRs can exist?
1
A. 2 B. 1 C. 0 D. With the above information we cannot answer the question. E. None of the above options
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