Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Question
Transcribed Image Text:Warr Company is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's projected IRR can be less than the
WACC or negative, in both cases it will be rejected.
Year
1
4
Cash flows
-$1540
$400
$400
$400
$400
O a. 4.13%
O b. 0.99%
O c. 1.22%
O d. 1.547%
O e. 3.58%
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