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The IRR rule suffers from several drawbacks, one of which has to do with projects of unconventional cash flows. In this assignment, we will be

The IRR rule suffers from several drawbacks, one of which has to do with projects of "unconventional cash flows." In this assignment, we will be able to demonstrate why unconventional cash flows disqualifies IRR.

Use the table below to create a plot of discount rate vs NPV. Please use the following range of discount rates: 0% to 85% at 5% increments.

Year

Cash Flows

0

1

2

3

4

5

-170

160

160

160

160

-520

Use your Excel work to answer the questions below.

What is the NPV using the discount rate of 5%?

What is the NPV using the discount rate of 10%?

What is the NPV using the discount rate of 65%?

What is the NPV using the discount rate of 70%?

Why is the IRR inappropriate for this particular project? State in 1-2 sentences.

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