By Hand(no excel): You conduct a Stock Project analysis over a period of 4 quarters....

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Accounting

By Hand(no excel): You conduct a Stock Project analysis over a period of 4 quarters. You would invest $10,000 initially, earn dividends each quarter, and eventually sell your stock at the end of the year. An after-tax summary of the net cash flow is provided below.

Time Period(Quarters) Net

0 -$10,000

1 $100

2 $105

3 $110

4 $11,358

The Quarterly IRR for this investment is closest to what number below? Recall that one definition of IRR is the interest rate where the sum of the present worth of all of a projects cash flows equals 0.

a) 3%

b) 3.5%

c) 4%

d) 4.5%

e) 5%

f) 5.5%

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