QUESTION 1

1. XYZ is evaluating a project that would require an initial investment of $71,800.00 today. The project is expected to produce annual cash flows of $8,900.00 each year forever with the first annual cash flow expected in 1 year. The NPV of the project is $7,800.00. What is the IRR of the project?

   		10.86% (plus or minus 0.02 percentage points)
   		12.40% (plus or minus 0.02 percentage points)
   		11.18% (plus or minus 0.02 percentage points)
   		13.91% (plus or minus 0.02 percentage points)
   		None of the above is within 0.02 percentage points of the correct answer