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Your firm is considering a project that will cost $4.637 million up front, generate cash flows of $3.54 million per year for 3 years, and
Your firm is considering a project that will cost $4.637 million up front, generate cash flows of $3.54 million per year for 3 years, and then have a cleanup and shutdown cost of $6.02 million in the fourth year. a. How many IRRs does this project have? b. Calculate a modified IRR for this project assuming a discount and compounding rate of 9.5%. c. Using the MIRR and a cost of capital of 9.5%, would you take the project? c. a. How many IRRs does this project have? The project has IRRs. (Select from the drop-down menu.) b. Calculate a modified IRR for this project assuming a discount and compounding rate of 9.5%. The MIRR for this project is %. (Round to two decimal places.) c. Using the MIRR and a cost of capital of 9.5%, would you take the project? (Select from the drop-down menu.) the project should be taken because the MIRR > 9.5%
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