Nichols Inc. is considering a project that has the following cash flow data. What is the...

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Finance

Nichols Inc. is considering a project that has the followingcash flow data. What is the project's IRR? Note that a project'sIRR can be less than the cost of capital or negative, in both casesit will be rejected.
Year
0
1
2
3
4
5
Cash flows
?$1,250
$325
$325
$325
$325
$325
a. 11.47%
b. 10.40%
c. 9.43%
d. 10.92%
e. 9.91%
Westwood Painting Co. is considering a project that has thefollowing cash flow and cost of capital (r) data. What is theproject's MIRR? Note that a project's MIRR can be less than thecost of capital (and even negative), in which case it will berejected.
r. 12.25%
Year
0
1
2
3
4
Cash flows
?$850
$300
$320
$340
$360
a. 20.04%
b. 13.42%
c. 16.56%
d. 14.91%
e. 18.22%
Worthington Inc. is considering a project that has the followingcash flow data. What is the project's payback?
Year
0
1
2
3
Cash flows
?$500
$150
$200
$300
a. 3.03 years
b. 2.25 years
c. 2.50 years
d. 2.75 years
e. 2.03 years

Answer & Explanation Solved by verified expert

4.3 Ratings (773 Votes)

Let the IRR be x Now Present Value of Cash Outflows Present Value of Cash Inflows 1250 325 10x 325 10x2 32510x3 32510x4 32510x5 Or x 9435 Hence the IRR is c 943 Present See Answer

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