Solve $5$d$,$ solve $6$d$,$ solve $7$d

$5$a$.$ EQ: Internal rate of return $=$ the rate that equates inflows with outflows

$5$b$.$ Rule: Accept the project if the IRR $>$ the required return.

$5$c$.$ EX: Reevaluate the project in $"1c"$ using the IRR method and a $10\%$ required return:

IRR$=9\mathrm{.}70\%$

REJECT

$5$d$.$ Problem: Reevaluate the project in $"3c"$ using the IRR method and an $11\%$ required return.

$6$a$.$ EQ: Modified IRR $=[\frac{FVof\text{i}\text{n}\text{f}\text{l}\text{o}\text{w}\text{s}}{C}$ost ${]}^{\frac{1}{n}}-1$

$6$b$.$ Rule: Accept the project if the MIRR $>$ the required return.

$6$c$.$ EX: Reevaluate the project in $"1c"$ using the MIRR method, a $3\%$ re$-$interest rate and a $10\%$ required rate. $M$ MRR $=[\frac{\text{\$}10,0003\mathrm{.}0909}{\text{\$}}25,000{]}^{\frac{1}{3}}-1=0\mathrm{.}0733$ or $7\mathrm{.}33\%$ REJECT

$6$d$.$ Problem: Evaluate a project costing $$100,000$ and returning $$25,000$ annually for five years using the MIRR method, a $4\%$ re$-$interest rate and a $9\%$ required return.

$7$a$.$ EQ: Profitability index $=PV$ of the inflows $/$ Cost

$7$b$.$ Rule: Accept the project if the PI $>1.$

$7$c$.$ EX: Evaluate a project costing $$25,000$ and returning $$10,000$ annually for years $1-3$ using the PI method and a $10\%$ discount rate. PI $=$$$24,\frac{869}{\text{\$}}25,000=0\mathrm{.}9947$ REJECT

$7$d$.$ Problem: Evaluate a project costing $$15,000$ and returning $$3000$ annually for $10$ years using the PI method and a $13\%$ discount rate.