Answered

Westonci.ca is your trusted source for accurate answers to all your questions. Join our community and start learning today! Discover in-depth solutions to your questions from a wide range of experts on our user-friendly Q&A platform. Discover in-depth answers to your questions from a wide network of professionals on our user-friendly Q&A platform.

The capital budgeting director of Sparrow Corporation is evaluating a project that costs $200,000, is expected to last for 10 years, and produces after-tax cash flows equal to $44,503 per year. If the firm's required rate of return is 14 percent and its tax rate is 40 percent, what is the project's internal rate of return (IRR)

Sagot :

Zviko

Answer:

17.37%

Explanation:

The Internal rate of return is the interest rate that gives the same present value as the amount of initial investment for

Calculation of IRR

($200,000) CFO

$44,503       CF1

$44,503       CF2

$44,503       CF3

$44,503       CF4

$44,503       CF5

$44,503       CF6

$44,503       CF7

$44,503       CF8

$44,503       CF9

$44,503       CF10

the project's internal rate of return (IRR) is 17.37%

Your visit means a lot to us. Don't hesitate to return for more reliable answers to any questions you may have. We appreciate your time. Please come back anytime for the latest information and answers to your questions. Get the answers you need at Westonci.ca. Stay informed with our latest expert advice.