Fill This Form To Receive Instant Help

Help in Homework
trustpilot ratings
google ratings


Homework answers / question archive / Consider the following annual project cash flows: CF0 = -$200, CFI = $150, CF2 = $50, and CF3 = $100

Consider the following annual project cash flows: CF0 = -$200, CFI = $150, CF2 = $50, and CF3 = $100

Finance

Consider the following annual project cash flows: CF0 = -$200, CFI = $150, CF2 = $50, and CF3 = $100. The required rate of return is 10%, the NPV is $53, and the IRR is 26%. By how much would the IRR change if the required rate of return would increase from 10% to 15%? a) IRR would increase by 50 percentage points. b) IRR would decrease by 50 percentage points. c) IRR would increase by 1/3. d) IRR would decrease by 1/3. e) IRR would not change. 
 

pur-new-sol

Purchase A New Answer

Custom new solution created by our subject matter experts

GET A QUOTE

Answer Preview

The correct option is E "IRR would not change".