8. Calculate Internal Rate of Return from the following information:Initial investment = Rs 6,00,000Life of the asset = 4 yearsEstimated net annual cash inflows:1st year ended = Rs 1,50,0002ndyear ended = Rs 2,00,000%3D3rd year ended = Rs 3,00,0004th year ended = 2,00,000.

IRR is a discount rate that make NPV of project zero. We need to use excel to calculate IRR

8. Calculate Internal Rate of Return from the following information: Initial investment = Rs 6,00,000 %3D Life of the asset = 4 years %3D Estimated net annual cash inflows: 1st year ended = Rs 1,50,000 %3D 2nd year ended = Rs 2,00,000 3rd year ended =Rs 3,00,000 %3D uoor ondod 200 00O

8. Calculate Internal Rate of Return from the following information: Initial investment = Rs 6,00,000 %3D Life of the asset = 4 years %3D Estimated net annual cash inflows: 1st year ended = Rs 1,50,000 %3D 2nd year ended = Rs 2,00,000 3rd year ended =Rs 3,00,000 %3D uoor ondod 200 00O

EBK CFIN

6th Edition

ISBN:9781337671743

Author:BESLEY

Publisher:BESLEY

Chapter8: Risk And Rates Of Return

Section: Chapter Questions

Problem 7PROB

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Concept explainers

Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.

Question

8. Calculate Internal Rate of Return from the following information:
Initial investment = Rs 6,00,000
Life of the asset = 4 years
Estimated net annual cash inflows:
1st year ended = Rs 1,50,000
2nd
year ended = Rs 2,00,000
%3D
3rd year ended = Rs 3,00,000
4th year ended = 2,00,000.

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