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Fundamentals of Financial Manageme...

8th Edition
Eugene F. Brigham + 1 other
Publisher: Cengage Learning
ISBN: 9781285065137

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BuyFindarrow_forward

Fundamentals of Financial Manageme...

8th Edition
Eugene F. Brigham + 1 other
Publisher: Cengage Learning
ISBN: 9781285065137
Chapter 11, Problem 2P
Textbook Problem
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IRR Refer to Problem 11-1. What is the project’s IRR?

Summary Introduction

To calculate: The IRR of the given project.

Internal Rate of Return (IRR):

It refers to the rate of return that is computed by the company to make a decision of selection of a project for investment. This rate provides the basis for selection of projects with lower cost of capital and rejection of project with higher cost of capital.

Explanation of Solution

Given,

Cost of the project is $52,125.

Life of project is 8 years.

Cash inflow from project per year is $12,000.

Cost of capital of the project is 12%...

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Chapter 11 Solutions

Fundamentals of Financial Management, Concise Edition (with Thomson ONE - Business School Edition, 1 term (6 months) Printed Access Card) (MindTap Course List)
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