Tracey Tables is considering an equipment investment that will cost $910,000. Projected net cash inflows over the equipment's three-year life are as follows: Year 1: $484,000; Year 2: $392,000; and Year 3: $294,000. Tracey wants to know the equipment's IRR. (Click the icon to view the present value annuity table.) (Click the icon to view the present value factor table.) (Click the icon to view the future value annuity table.) Requirement (Click the icon to view the future value factor table.) Use trial and error to find the IRR within a 2% range. (Hint: Use Tracey's hurdle rate of 12% to begin the trial-and-error process.) Use a business calculator or spreadsheet to compute the exact IRR. Begin by calculating the NPV at three rates: 12%, 14%, and 16%. (Round your answers to the nearest whole dollar. Use parentheses or a minus sign for negative net present values.) The NPV at 12% is Reference Present Value of Annuity of $1 Periods 1% Period 1 0.990 Period 2 1.970 Period 3 2.941 Period 4 3.902 Period 5 4.853 Period 6 5.795 Period 7 6.728 Period 8 7.652 Period 9 8.566 Period 10 9.471 2% 3% 4% 5% 6% 8% 10% 12% 0.980 0.971 0.962 0.952 0.943 0.926 0.909 0.893 1.942 1.913 1.886 1.859 1.833 1.783 1.736 1.690 2.884 2.829 2.775 2.723 2.673 2.577 2.487 2.402 3.808 3.717 3.630 3.546 3.465 3.312 3.170 3.037 4.713 4.580 4.452 4.329 4.212 3.993 3.791 3.605 5.601 5.417 5.242 5.076 4.917 4.623 4.355 4.111 6.472 6.230 6.002 5.786 5.582 5.206 4.868 4.564 7.325 7.020 6.733 6.463 6.210 5.747 5.335 4.968 8.162 7.786 7.435 7.108 6.802 6.247 5.759 5.328 8.983 8.530 8.111 7.722 7.360 6.710 6.145 5.650 Period 11 10.368 9.787 9.253 8.760 8.306 7.887 7.139 6.495 5.938 Period 12 11.255 10.575 9.954 9.385 8.863 8.384 7.536 6.814 6.194 Period 13 12.134 11.348 10.635 9.986 9.394 8.853 7.904 7.103 6.424 Period 14 13.004 12.106 11.296 10.563 9.899 9.295 8.244 7.367 6.628 Period 15 13.865 12.849 11.938 11.118 10.380 9.712 8.559 7.606 6.811 Period 20 18.046 16.351 14.877 13.590 12.462 11.470 9.818 8.514 7.469 Period 25 22.023 19.523 17.413| 15.622| 14.094 12.783| 10.675 9.077 7.843 Period 30 25.808 22.396 | 19.600 17.292 15.372 13.765| 11.258 9.427 8.055 Period 40 32.835 27.355 23.115 19.793 17.159 15.046 11.925 9.779 8.244 14% 16% 18% 20% 0.877 0.862 0.847 0.833 1.647 1.605 2.322 2.246 2.914 2.798 2.690 3.433 3.274 3.127 2.991 3.889 3.685 3.498 3.326 4.288 4.039 3.812 3.605 4.639 4.344 4.078 3.837 4.946 4.607 4.303 4.031 5.216 4.833 4.494 4.192 1.566 1.528 2.174 2.106 2.589 5.453 5.029 4.656 4.327 5.660 5.197 4.793 4.439 5.842 5.342 4.910 4.533 6.002 5.468 5.008 4.611 6.142 5.575 5.092 4.675 6.623 5.929 5.353 4.870 6.873 6.097 5.467 4.948 7.003 6.177 5.517 4.979 7.105 6.233 5.548 4.997 Reference Future Value of Annuity of $1 - Periods 1% 2% 3% 4% 5% 6% Period 1 1.000 1.000 1.000 1.000 1.000 1.000 1.000 8% 10% 1.000 12% 14% 16% 18% 20% 1.000 1.000 1.000 1.000 1.000 Period 2 2.010 2.020 2.030 2.040 2.050 2.060 2.080 2.100 2.120 2.140 2.160 2.180 2.200 Period 3 3.030 3.060 3.091 3.122 3.153 3.184 3.246 3.310 3.374 3.440 3.506 3.572 3.640 Period 4 4.060 4.122 4.184 4.246 4.310 4.375 4.506 4.641 4.779 4.921 5.066 5.215 5.368 Period 5 5.101 5.204 5.309 5.416 5.526 5.637 5.867 6.105 6.353 6.610 6.877 7.154 7.442 Period 6 6.152 6.308 6.468 6.633 6.802 6.975 7.336 7.716 8.115 8.536 8.977 9.442 9.930 Period 7 7.214 7.434 Period 8 8.286 8.583 8.892 Period 9 Period 10 Period 11 Period 12 Period 13 Period 14 9.369 9.755 10.462 10.950 11.567 12.683 10.159 11.464 12.169 12.808 7.662 7.898 8.142 8.394 8.923 9.487 10.089 9.214 9.549 9.897 10.637 11.436 12.300 10.583 | 11.027 11.491 12.488 13.579 14.776 12.006 12.578 13.181 14.487 15.937 17.549 10.730 11.414 12.142 12.916 13.233 16.085 14.240 15.327 16.499 17.519 19.086 20.799 19.337 21.321 23.521 25.959 13.486 14.207 14.972 16.645 18.531 20.655 23.045 25.733 28.755 32.150 13.412 | 14.192 15.026 15.917 16.870 18.977 21.384 24.133 27.271 30.850 34.931 39.581 Period 15 Period 20 Period 25 Period 30 Period 40 13.809 14.680 15.618 14.947 15.974 | 17.086 16.097 17.293 18.599 16.627 17.713 18.882 21.495 24.523 28.029 36.786 42.219 48.497 18.292 | 19.599 21.015 24.215 27.975 32.393 37.581 43.672 50.818 59.196 20.024 21.579 23.276 27.152 31.772 37.280 43.842 51.660 60.965 72.035 22.019 24.297 26.870 29.778 33.066 36.786 45.762 57.275 72.052 91.025 115.380 146.628 186.688 28.243 32.030 | 36.459 41.646 47.727 54.865 73.106 98.347 133.334 181.871 249.214 342.603 471.981 34.785 40.568 47.575 56.085 66.439 79.058 113.283 164.494 241.333 356.787 530.312 790.948 1,181.882 48.886 60.402 75.401 95.026 120.800 154.762 259.057 442.593 767.091 1,342.025 2,360.757 4,163.213 7,343.858 32.089 Reference Present Value of $1 Periods 1% 2% 3% 4% Period 1 0.990 0.980 0.971 0.962 Period 2 0.980 0.961 0.943 0.925 Period 3 0.971 0.942 0.915 0.889 Period 4 0.961 0.924 0.888 0.855 Period 5 0.951 0.906 0.863 0.822 0.784 Period 6 0.942 0.888 0.837 0.790 0.746 0.705 Period 7 0.933 0.871 0.813 0.760 0.711 0.665 Period 8 0.923 Period 9 0.914 Period 10 0.905 0.853 0.789 0.731 0.677 0.627 0.837 0.766 0.820 0.744 0.703 0.645 0.676 0.614 0.558 0.592 0.463 0.386 0.322 5% 6% 8% 10% 12% 14% 16% 18% 20% 0.952 0.943 0.926 0.909 0.893 0.877 0.862 0.847 0.833 0.907 0.890 0.857 0.826 0.797 0.769 0.743 0.718 0.694 0.864 0.840 0.794 0.751 0.712 0.675 0.641 0.609 0.579 0.823 0.792 0.735 0.683 0.636 0.592 0.552 0.516 0.482 0.747 0.681 0.621 0.567 0.519 0.476 0.437 0.402 0.630 0.564 0.507 0.456 0.410 0.370 0.335 0.583 0.513 0.452 0.400 0.354 0.314 0.279 0.540 0.467 0.404 0.351 0.305 0.266 0.233 0.500 0.424 0.361 0.308 0.263 0.225 0.194 0.270 0.227 0.191 0.162 Period 11 0.896 Period 12 0.887 Period 13 0.879 Period 14 0.870 0.804 0.722 0.650 0.788 0.701 0.625 0.585 0.527 0.557 0.497 0.429 0.350 0.287 0.237 0.397 0.319 0.257 0.208 0.195 0.162 0.135 0.168 0.137 0.112 0.773 0.681 0.601 0.530 0.469 0.368 0.290 0.229 0.182 0.145 0.116 0.093 0.758 0.661 0.577 0.505 0.442 0.340 0.263 0.205 0.160 0.125 0.099 0.078 Period 15 0.861 0.743 0.642 0.555 0.481 0.417 0.315 0.239 0.183 0.140 0.108 0.084 0.065 Period 20 0.820 0.673 0.554 0.456 Period 25 0.780 0.610 0.478 0.375 Period 40 Period 30 0.742 0.672 0.552 0.412 0.453 0.307 0.377 0.295 0.308 0.231 0.208 0.142 0.312 0.215 0.149 0.233 0.146 0.092 0.174 0.099 0.057 0.097 0.046 0.022 0.104 0.073 0.051 0.037 0.026 0.059 0.038 0.024 0.033 0.020 0.012 0.011 0.005 0.003 0.016 0.007 0.004 0.001 0.010 0.001 Reference Future Value of $1 Periods 1% 2% 3% 4% 5% Period 1 1.010 1.020 1.030 1.040 1.050 Period 2 1.020 1.040 1.061 1.082 1.103 Period 3 1.030 1.061 1.093 1.125 1.158 1.191 6% 8% 10% 12% 1.060 1.080 1.100 1.120 1.140 1.124 1.166 1.210 1.254 1.300 1.346 1.260 1.331 14% 16% 18% 20% 1.160 1.180 1.200 1.392 1.440 1.405 1.482 1.561 1.643 1.728 Period 4 1.041 1.082 1.126 1.170 1.216 1.262 1.360 1.464 1.574 1.689 1.811 1.939 2.074 Period 5 1.051 1.104 1.159 1.217 1.276 1.338 1.469 1.611 1.762 1.925 2.100 2.288 2.488 Period 6 1.062 1.126 1.194 1.265 1.340 1.419 1.587 1.772 1.974 2.195 2.436 2.700 2.986 Period 7 1.072 1.149 1.230 1.316 Period 8 1.083 1.172 1.267 1.369 Period 9 1.094 1.195 1.305 1.423 Period 10 1.105 1.219 1.344 1.480 1.407 1.504 1.714 1.949 1.477 1.594 1.851 2.144 2.476 2.853 1.551 1.689 1.999 2.358 1.629 1.791 2.159 2.594 2.211 2.502 2.826 3.185 3.583 3.278 3.759 4.300 2.773 3.252 3.803 4.435 5.160 3.106 3.707 4.411 5.234 6.192 Period 11 1.116 1.243 1.384 1.539 1.710 Period 12 1.127 1.268 1.426 1.601 Period 13 1.138 1.294 Period 14 Period 15 1.149 1.161 1.469 1.665 1.319 1.513 1.732 1.346 1.558 1.801 Period 20 1.220 1.486 1.806 2.191 Period 25 1.282 1.641 2.094 2.666 2.653 3.386 Period 30 1.348 1.811 2.427 3.243 4.322 Period 40 1.489 2.208 3.262 4.801 7.040 1.898 2.332 2.853 3.479 4.226 1.796 2.012 2.518 3.138 3.896 4.818 1.886 2.133 2.720 3.452 4.363 5.492 1.980 2.261 2.937 3.797 4.887 6.261 7.988 10.147 2.079 2.397 3.172 4.177 5.474 7.138 9.266 11.974 3.207 4.661 6.727 9.646 13.743 19.461 27.393 38.338 4.292 6.848 10.835 17.000 26.462 40.874 62.669 95.396 5.743 10.063 | 17.449 29.960 50.950 85.850 143.371 237.376 10.286 21.725 45.259 93.051 188.884 378.721 750.378 1,469.772 5.117 6.176 7.430 5.936 7.288 8.916 6.886 8.599 10.699 12.839 15.407