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Toro Corporation is considering a new gadget that will cost $49,100 in startup costs. The gadget is expected to produce cash flows of $41,200 in
Toro Corporation is considering a new gadget that will cost $49,100 in startup costs. The gadget is expected to produce cash flows of $41,200 in Year 1 and $16,500 in Year 2. The gadget will be discontinued after the second year. The discount rate assigned to the gadget is 14.9 percent. Should the gadget be produced? What is the IRR?
Yes; 15.64% | ||
Yes; 15.23% | ||
Yes; 14.72% | ||
No; 14.17% | ||
No; 13.51% |
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