Consider a project with the following cash flows. What's the IRR of the project? If a firm's cost of capital is 15%,should the firm accept the project?

Name: Consider a project with the following cash flows. What's the IRR of the project? If a firm's cost of capital is 15%,should the firm accept the project?
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Question

Consider a project with the following cash flows.  What's the IRR of the project? If a firm's cost of capital is 15%,should the firm accept the project?

Quizplus · Accepted Answer

Let r represent the IRR of the investment. -16,000 + 42,000/(1+r)- 27,000/(1+r)² = 0 r₁ = 12.5%,r₂ = 50% When r = 15%,the NPV of the project is greater than 0,should accept the project

Consider a Project with the Following Cash Flows