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The investment has initial costs of $7,000, installation costs of $2,500 and will cause adaptation costs of $2,000. (Assume these payments are made in period

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The investment has initial costs of $7,000, installation costs of $2,500 and will cause adaptation costs of $2,000. (Assume these payments are made in period 0.) The cash flows are $5,400; $2,200; $5,000 and $5,800 in each period 1-4 respectively. You are asked to calculate the internal rate of return (IRR). As you walk over to your computer to run the numbers in Excel, your colleague asks you what the NPV will be if you use the IRR as the hurdle rate in your calculations

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