Question

You are considering an investment for which you require a 14 percent rate of return. the investment costs $61,900 and will produce cash inflows of $26,000 for three years. should you accept this project based on its internal rate of return? why or why not?

Answer 1

You are considering an investment for which you require a 14 percent rate of return. the investment costs $61,900 and will produce cash inflows of $26,000for three years.You should not accept this project based on its internal rate of return, because the IRR is 12.51 percent