A rural community/company is considering an investment in a cottage industry for which the net cash flows have been estimated as follows: i) What is the NPV if the discount rate is 10%? ii) Using discount rates of 10% and 14% calculate the IRR? iii) Is this project acceptable?

ENGR.ECONOMIC ANALYSIS
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Chapter1: Making Economics Decisions
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A rural community/company is considering an investment in a cottage industry for which the net cash flows have been estimated as follows:

i) What is the NPV if the discount rate is 10%?

ii) Using discount rates of 10% and 14% calculate the IRR?

iii) Is this project acceptable?

Year
1
2
3
4
Net cash flow -5000
1500
1300
1800
2000
$4
Transcribed Image Text:Year 1 2 3 4 Net cash flow -5000 1500 1300 1800 2000 $4
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