A project has cash flows of -$161,900, $60,800, $62,300, and $75,000 for Years 0 to 3, respectively. The required rate of return is 13 percent. Based on the internal rate of return of ________ percent for this project, you should ________ the project.
A) 9.67; accept
B) 10.41; reject
C) 11.67; accept
D) 10.41; accept
E) 9.67; reject

Question

Quizplus · Accepted Answer

The internal rate of return (IRR) is 10.41%, which is less than the required rate of return of 13%, so the project should be rejected.

A Project Has Cash Flows of -$161,900, $60,800, $62,300, and $75,000