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Artie's Wrestling Stuff is considering building a new plant. This plant would require an initial cash...

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Finance

Artie's Wrestling Stuff is considering building a new plant.This plant would require an initial cash outlay of ?$ 8 million andwould generate annual free cash inflows of ?$ 1 million per yearfor 8 years. Calculate the? project's MIRR ?given: a. A requiredrate of return of 9 percent b. A required rate of return of 12percent c. A required rate of return of 15 percent

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3.8 Ratings (508 Votes)
aCombination approachAll negative cash flows are discounted back to the present and allpositive cash flows are compounded out to the end of the projectslifeThus year 8 modified cashflow1831681541411311910911104Thus year 0 modified cash flow88Discount rate9000Year012345678Cash flow stream800010001000100010001000100010001000Discount factor100010901188129514121539167718281993Compound    See Answer
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Artie's Wrestling Stuff is considering building a new plant.This plant would require an initial cash outlay of ?$ 8 million andwould generate annual free cash inflows of ?$ 1 million per yearfor 8 years. Calculate the? project's MIRR ?given: a. A requiredrate of return of 9 percent b. A required rate of return of 12percent c. A required rate of return of 15 percent

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