Project L costs $51,788

Finance Dec 21, 2020

Project L costs $51,788.84, its expected cash inflows are $12,000 per year for 8 years, and its WACC is 119. What is the project's IRR2 Round your answer to two decimal places

Expert Solution

Let irr be x%
At irr,present value of inflows=present value of outflows.

51788.84=12000/1.0x+12000/1.0x^2+................+12000/1.0x^8

Hence x=irr=16.2%(Approx)

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