Calculating IRR. A firm evaluates all of its projects by applying the IRR rule. If...
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Calculating IRR. A firm evaluates all of its projects by applying the IRR rule. If the required return is 13 percent, should the firm accept the following project?
| Year | Cash Flow |
| 0 | -$145,000 |
| 1 | 71,000 |
| 2 | 68,000 |
| 3 | 52,000 |
For the cash flows in the previous problem, suppose the firm uses the NPV decision rule. At a required return of 10 percent, should the firm accept this project? What if the required return was 21 percent?
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