Grant deposited $9,000 in an investment account. He receives a monthly return of $350 for 3...

Grant deposited $9,000 in an investment account. He receives a monthly return of $350 for 3 years. After one year, he makes another investment of $3,000 at the same bank, with monthly returns of $250 for a year and a half. What is Grant’s IRR? (hint: first combine the cash flow streams)

Expert Solution

cash flow for 1st year (12 months ) includes only +350

cash flow for next year and a half (18 months ) includes 350 +250 = 600

cash flow for last 6 months = 350

note that investments are depicted by negative sign since they are considered as cash outflows

jeff jeffy answered 1 year ago

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