Blinding Light Co. has a project available with the following cash flows: Year Cash Flow 0...

Blinding Light Co. has a project available with the following cash flows:

Year	Cash Flow
0	−$32,830
1	8,390
2	10,130
3	14,540
4	16,170
5	11,180

What is the project's IRR?

Multiple Choice

23.32%
24.25%
20.15%
24.87%
22.39%

Solutions

Expert Solution

Internal rate of return can be calculated using a financial calculator by inputting the below:

Press the CF button.
CF0= -$32,830. The initial cash flow is indicated by a negative sign since it is a cash outflow.
Cash flow for each of the fifteen years should be entered.
Press Enter and down arrow after inputting each cash flow.
After entering the last cash flow cash flow, press the IRR and CPT button to get the IRR of the project.

The IRR of the project is 22.39%.

Hence, the answer is option e.

jeff jeffy answered 1 year ago

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