A firm earns the following cash flows. What discount rate (WACC) would cause the firm to...

A firm earns the following cash flows. What discount rate (WACC) would cause the firm to be indifferent between accepting and rejecting the firm if the initial investment were $500?
- Year: CF
- 1 90
- 2 120
- 3 190
- 4 160
- 5 60

		7.80%
		7.11%
		7.34%
		7.66%

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Expert Solution

So the WACC at which the firm would be indifferent is 7.66%

Formulae

jeff jeffy answered 2 years ago

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