Required information Skip to question [The following information applies to the questions displayed below.] NOTE: Throughout this lab, every time a screenshot is requested, use your computer's screenshot tool, and paste each screenshot to the same Word document. Label each screenshot in accordance to what is noted in the lab. This document with all of the screenshots included should be uploaded through Connect as a Word or PDF document when you have reached the final step of the lab. In this lab, you will: Required: In this lab, we take the perspective of an investor looking at two different potential investment scenarios in shares of stock and considering the profitability of the expected cash flows. 1. Use IRR to evaluate the potential investments. Ask the Question: How can IRR be used to evaluate potential investments? Master the Data: Apply the same steps as Lab 9-4 to the Lab 9-4 Alt Data.xlsx dataset. Marcia Watson is trying to evaluate the profitability of three investments over an 8-year horizon. Use the Excel IRR() function to evaluate the potential investments over the life of the cash flows for each of these three investments. Software needed Excel Screen capture tool (Windows: Snipping Tool; Mac: Cmd+Shift+4) Data: Excel File Lab 9-4 Alt Data.xlsx. Perform the Analysis: Refer to Lab 9-4 Alternate in the text for instructions and Lab 9-4 steps for each the of lab parts. Share the Story: We have done one level of analysis, the internal rate of return, to evaluate the profitability of Investments 14. What we have not factored in here is the different amount of risk for these two companies. rev: 09_21_2020_QC_CS-228676 Required:

1. According to the IRR analysis, which investment is most profitable over the life of the investment?

multiple choice 1

A. Investment

B. 1 Investment 2

C. Investment 3

2. According to the IRR analysis, which investment is least profitable over the life of the investment?

multiple choice 2

A. Investment 2

B. Investment 1

C. Investment 3

3. What is the amount of net cash flows (not discounted) over the life of the investment?

multiple choice 3

A. $90,000

B. $66,000

C. $76,000

D. $100,000

4. What would be the IRR for a company that makes a $100,000 investment in year 0, and then receives $20,000 per year each of the next eight years?

multiple choice 4

A. 10%

B. 12%

C. 11.81%

D. 9.09%

5. What would the net cash flows (not discounted) for a company that makes a $100,000 investment in year 0, and then receives $20,000 per year each of the next eight years?

multiple choice 5

A. $160,000

B.$60,000

C. $0

D. $100,000