Question 10: Consider the following cash flow profile and assume MARR is 12%/year. End of Year Cash Flow 0 -1000 1 2 -5700 3400 3800 a. What does Descartes' rule of signs tell us about the IRR (s) of this project? b. What does the Norstrom's criterion tell us about the IRR (s) of this project? c. Determine the ERR for this project. Is this project economically attractive? 3
Question 10: Consider the following cash flow profile and assume MARR is 12%/year. End of Year Cash Flow 0 -1000 1 2 -5700 3400 3800 a. What does Descartes' rule of signs tell us about the IRR (s) of this project? b. What does the Norstrom's criterion tell us about the IRR (s) of this project? c. Determine the ERR for this project. Is this project economically attractive? 3
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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