Coronado Corporation is considering investing in a new facility. The estimated cost of the facility is $2,190,000. It will be used for 12 years, then sold for $771,000. The facility will generate annual cash inflows of $392,000 and will need new annual cash outflows of $142,000. The company has a required rate of return of 5%. Calculate the internal rate of return on this project, and discuss whether the project should be accepted. (Round answer to O decimal places, e.g. 13%.) Internal rate of return The project should be %

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
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Coronado Corporation is considering investing in a new facility. The estimated cost of the facility is $2,190,000. It will be used for 12
years, then sold for $771,000. The facility will generate annual cash inflows of $392,000 and will need new annual cash outflows of
$142,000. The company has a required rate of return of 5%
Calculate the internal rate of return on this project, and discuss whether the project should be accepted. (Round answer to O decimal
places, e.g. 13%.)
Internal rate of return
The project should be
eTextbook and Media
Transcribed Image Text:Coronado Corporation is considering investing in a new facility. The estimated cost of the facility is $2,190,000. It will be used for 12 years, then sold for $771,000. The facility will generate annual cash inflows of $392,000 and will need new annual cash outflows of $142,000. The company has a required rate of return of 5% Calculate the internal rate of return on this project, and discuss whether the project should be accepted. (Round answer to O decimal places, e.g. 13%.) Internal rate of return The project should be eTextbook and Media
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