The Internal rate of return for each project. Introduction: Internal Rate of Return is a measure used in the capital budgeting which estimates the profitability of potential investments. IRR is computed as a discount rate that makes the net present value of all cash flows from an investment as zero. N P V = CF 1 ( 1 + r ) 1 + CF 2 ( 1 + r ) 2 + CF 3 ( 1 + r ) 3 + CF 4 ( 1 + r ) 4 − I 0

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Chapter 10, Problem 10.4WUE

Summary Introduction

To determine:

The Internal rate of return for each project.

Introduction:

Internal Rate of Return is a measure used in the capital budgeting which estimates the profitability of potential investments. IRR is computed as a discount rate that makes the net present value of all cash flows from an investment as zero.

NPV=CF1(1+r)1+CF2(1+r)2+CF3(1+r)3+CF4(1+r)4−I0

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