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Compute the MIRR statistic for Project I if the appropriate cost of capital is 13 percent....

Compute the MIRR statistic for Project I if the appropriate cost of capital is 13 percent. (Do not round intermediate calculations. Round your final answer to 2 decimal places.) Project I Time: 0 1 2 3 4 Cash flow –$11,500 $5,580 $4,430 $1,770 $2,250 MIRR % Should the project be accepted or rejected?

Solutions

Expert Solution

A B C
2 WACC= 13%
3 Year Project X's Cash F;ow
4 0 $                    (11,500.00)
5 1 $                        5,580.00
6 2 $                        4,430.00
7 3 $                        1,770.00
8 4 $                        2,250.00
MIRR= MIRR(C4:C8,C2,C2)
MIRR= 12%
In this case MIRR is less than Cost of capital Project should not be accepted.

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