Question
POTAK Ventures is considering investing in a Taxi business, as part of its business line of operation, that requires an initial outlay of GH20million. It
POTAK Ventures is considering investing in a Taxi business, as part of its business line of operation, that requires an initial outlay of GH20million. It expected that the taxi will produce a constant yearly return of GH5 million for the next 5 years. It is known that the discount rate is 15%. POTAK Ventures is contemplating on whether the business is feasible or otherwise. As a financial and investment analyst, calculate the Internal Rate of Return and advice POTAK Ventures on the level of interest rate at which the business is worthwhile or otherwise.
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