In: Finance
Cummings Products Company is considering the following investment. The project’s expected cash flows are as follows:
Year |
Cash flow |
0 |
-$3,000 |
1 |
-3,870 |
2 |
-1,930 |
3 |
6,000 |
4 |
6,000 |
5 |
-11,000 |
6 |
8,500 |
7 |
2,800 |
8 |
-5,000 |
1. Assume a discount rate of 15 percent. What is the PV of all cash outflows?
2. Assume a discount rate of 15 percent. What is the FV of all cash inflows?
3. Assume a discount rate of 15 percent. What is the project's MIRR?
4. should this project be accepted based solely on the MIRR rule?