Consider a project with the following cash flows. Year Cash Flow 0 -$15,000 1 41,000 2 -27,000 What’s the IRR of the project? If a firm’s cost of capital is 12%, should the firm accept the project? Group of answer choices 10.6% and 62.7%; accept the project 10.6%; reject the project 62.7%; accept the project 10.6%, and 62.7%; reject the project
Consider a project with the following cash flows. Year Cash Flow 0 -$15,000 1 41,000 2 -27,000 What’s the IRR of the project? If a firm’s cost of capital is 12%, should the firm accept the project? Group of answer choices 10.6% and 62.7%; accept the project 10.6%; reject the project 62.7%; accept the project 10.6%, and 62.7%; reject the project
Chapter11: Capital Budgeting And Risk
Section: Chapter Questions
Problem 14P
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Question
Consider a project with the following cash flows.
What’s the IRR of the project? If a firm’s cost of capital is 12%, should the firm accept the project?
Year |
Cash Flow
|
0 |
-$15,000
|
1 |
41,000
|
2 |
-27,000
|
What’s the IRR of the project? If a firm’s cost of capital is 12%, should the firm accept the project?
Group of answer choices
10.6% and 62.7%; accept the project
10.6%; reject the project
62.7%; accept the project
10.6%, and 62.7%; reject the project
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