Question
use the following information for project Kohram: Year Est Cash Flow (in $thousands) 0 -$500 1 -$25 2 $135 3 $450 4 $630 5 $250
use the following information for project Kohram:
Year | Est Cash Flow (in $thousands) |
0 | -$500 |
1 | -$25 |
2 | $135 |
3 | $450 |
4 | $630 |
5 | $250 |
Required rate of return = 22%
$940 is Project Kohrmans net present value (in $thousands) and the internal rate of return is 22.0%
1.Based on net present value only should you accept or reject project Kohrman
A) Except
B)Rejects
C)Not enough information to answer
2. based solely on internal rate of return should you accept or reject project and why?
A) Accept because IRR is positive
B) Accept because IRR > 22% C) Reject because IRR is negative
D) Reject because IRR > 22%
E)Accept because IRR = 22%
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started