A local company requires all capital investments to generate a minimum internal rate of return of 16%. The company is currently considering an investment that is expected to generate annual cash inflows of $45,000 for 7 years. The cost of this investment is $180,000.
Required: Would you recommend the company make this investment? Why or why not? Show computations and ignore income taxes.

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The Answer of A local company requires all capital investments to generate a minimum internal rate of return of 16%. The company is currently considering an investment that is expected to generate annual cash inflows of $45,000 for 7 years. The cost of this investment is $180,000.
Required: Would you recommend the company make this investment? Why or why not? Show computations and ignore income taxes.

A Local Company Requires All Capital Investments to Generate a Minimum