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Turner Video will invest $64,500 in a project. The firm's discount rate (cost of capital) is 6 percent. The investment will provide the following inflows:
Turner Video will invest $64,500 in a project. The firm's discount rate (cost of capital) is 6 percent. The investment will provide the following inflows: (Use a Financial calculator to arrive at the onswers.) The IRR is 10 percent. a. If reinvestment is assumed at the cost of capital rate used by the NPV method, what will be the total value of the inflows after-five years? (Assume the inflows come at the end of each year.) (Do not round intermediate calculations. Round the final answer to the nearest whole dollar.) Total value of inflows $ b. If the reinvestment is assumed at the IRR, what will be the total value of the inflows after five years? (Do not round intermediate calculations. Round the final answer to the nearest whole dollar.) Total value of inflows $ c. Which investment assumption is better? Reinvestment assumption of IRR Reinvestment assumption of NPV
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