Question
In: Finance
What is NPV, IRR, PI, MIRR of a project with the following cash flows if the...
What is NPV, IRR, PI, MIRR of a project with the following cash flows if the discount rate is 14 percent?
|
Year |
CF |
|
0 |
-18,000 |
|
1 |
5000 |
|
2 |
7500 |
|
3 |
8400 |
|
4 |
2100 |
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Solutions
Expert Solution
PI = Present Value of Future Cash Inflows / Initial Investment
= $17,070.10069 / $18,000
= 0.948338933
PI of the project is 0.95
MIRR = (FutureValue of Future Cash Inflows / Present Value of Cash Outflows)^(1/n) - 1
= ( $28,830.72/ $18,000)^(1/4) - 1
= (1.601706667)^(0.25) - 1
= 1.124982446 - 1
= 0.124982446
= 12.50%
MIRR of the project is 12.50%
jeff jeffy answered 1 year agoRelated Solutions
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Investment A
Investment B
0
-$5,000,000
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1
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2
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5
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Cash flows for two mutually exclusive
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Year
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Investment B
0
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1
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2
$1,500,000
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3
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