please answer this IRR, investment life, and cash inflows Oak Enterprises...

80.2K

Verified Solution

Question

Finance

please answer this
image
IRR, investment life, and cash inflows Oak Enterprises accepts projects earning more than the firm's 11% cost of capital. Oak is currently considering a 13-year project that provides annual cash inflows of $20,000 and requires an initial investment of $170,000. a. Determine the IRR of this project. Is it acceptable? b. Assuming that the cash inflows continue to be $20.000 per year, how many additional years would the flows have to continue to make the project acceptable (that is, to make it have an IRR of 11%)? c. With the given ife, an initial investment of $170.000, and cost of capital of 11%, what is the minimum annual cash inflow the investment would have to provide in order for this project to make sense for Oak's shareholders? a. The project's IRR 1% (Round to two decimal places.)

Answer & Explanation Solved by verified expert
Get Answers to Unlimited Questions

Join us to gain access to millions of questions and expert answers. Enjoy exclusive benefits tailored just for you!

Membership Benefits:
  • Unlimited Question Access with detailed Answers
  • Zin AI - 3 Million Words
  • 10 Dall-E 3 Images
  • 20 Plot Generations
  • Conversation with Dialogue Memory
  • No Ads, Ever!
  • Access to Our Best AI Platform: Flex AI - Your personal assistant for all your inquiries!
Become a Member

Other questions asked by students