A five-year project requires an investment of -172 and has the following cash flows in years...

A five-year project requires an investment of -172 and has the following cash flows in years 1 through 5, respectively (all cash flows in dollars): 135, -95, 238, -75, and 118. Without actually calculating any IRR, what is the maximum possible value any of the real IRRs could have? Give your answer as a percent with two decimals; e.g., 23.24

Expert Solution

IRR is the rate where NPV = 0

NPV = present value of future cash flows - initial cash outflow

since there are cash outflows after initial year there will be more than one IRR for this project

So answer is 26.52%

jeff jeffy answered 2 years ago

A five-year project requires an investment of -255 and has the following cash flows in years...

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