A service company is evaluating a new service line with the following cash flows:Initial investment:...
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Accounting
A service company is evaluating a new service line with the following cash flows:
- Initial investment: $2,500,000
- Year 1: $700,000
- Year 2: $900,000
- Year 3: $1,100,000
- Year 4: $1,300,000
The discount rate is 7%.
- Calculate the NPV.
- Determine the IRR.
- Calculate the MIRR.
- Should the project be undertaken if the minimum acceptable IRR is 8%?
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