Question
The Sisyphean Company is planning on investing in a new project. This will involve the purchase of some new machinery costing $400,000. The Sisyphean Company
The Sisyphean Company is planning on investing in a new project. This will involve the purchase of some new machinery costing $400,000. The Sisyphean Company expects cash inflows from this project as detailed below:
| Year 1 | Year 2 | Year 3 | Year 4 |
| $157,452.98 | $157,452.98 | $157,452.98 | $157,452.98 |
The appropriate discount rate for this project is 15%. The internal rate of return (IRR) for this project is closest to ________.
| A. | 13% | |
| B. | 16% | |
| C. | 21% | |
| D. | 24% |
Please solve for r by hand step by step towards the solution. Do not use excel for this problem. May use excel to check work but ONLY AFTER solved by hand. Thank you.
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Corporate Valuation A Guide For Managers And Investors
Authors: Phillip R. Daves, Michael C. Ehrhardt, Ron E. Shrieves
1st Edition
0324274289, 978-0324274288
