Kiley Electronics is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's IRR can be less than the cost of capital (and even negative), in which case it will be rejected.
A) 9.70%
B) 10.78%
C) 11.98%
D) 13.31%
E) 14.64%

Question

Kiley Electronics is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's IRR can be less than the cost of capital (and even negative), in which case it will be rejected. 
A) 9.70% 
B) 10.78% 
C) 11.98% 
D) 13.31% 
E) 14.64%

Quizplus · Accepted Answer

Using a financial calculator or Excel, the IRR of the project is calculated to be 13.31%. This is greater than the cost of capital, indicating that the project should be accepted. Choice D is the correct answer.

Kiley Electronics Is Considering a Project That Has the Following