Duo Corporation is evaluating a project with the following cash flows:YearCash Flow0-$ 28,500110,7002313,40015,3004512,400-8,900The company uses an interest rate of 10 percent on all of its projects.Calculate the MIRR of the project using the discounting approach. (Do not roundintermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)MIRR18.54%Calculate the MIRR of the project using the reinvestment approach. (Do not roundintermediate calculations and enter your answer as a percent rounded to 2 decimalplaces, e.g., 32.16.)MIRR%

Given Information:Year 0 Cash Flow = -$28,500Year 1 Cash Flow = $10,700Year 2 Cash Flow =…

Answered: Duo Corporation is evaluating a project…

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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Duo Corporation is evaluating a project with the following cash flows: Year Cash Flow 0 -$ 28,900 1 11,100 2 13,800 3 15,700 4 5 12,800 -9,300 The company uses an interest rate of 9 percent on all of its projects. a. Calculate the MIRR of the project using the discounting approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the MIRR of the project using the reinvestment approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. Calculate the MIRR of the project using the combination approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) a. Discounting approach MIRR b. Reinvestment approach MIRR c. Combination approach MIRR % % % 1
Duo Corporation is evaluating a project with the following cash flows: Year 012345 Cash Flow -$ 29,900 12,100 14,800 16,700 13,800 -10,300 The company uses an interest rate of 10 percent on all of its projects. a. Calculate the MIRR of the project using the discounting approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. Calculate the MIRR of the project using the reinvestment approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) c. Calculate the MIRR of the project using the combination approach. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) Answer is complete but not entirely correct. a. Discounting approach MIRR b. Reinvestment approach MIRR c. Combination approach MIRR 20.68 12.85 x 12.87 x
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