Question

In: Finance

You have purchased a canning machine for $5,000. You expect the machine to save your company...

You have purchased a canning machine for $5,000. You expect the machine to save your company $1,425 each year for the next 10 years. What is the IRR of the machine?

Solutions

Expert Solution

Solution :

The IRR of the machine is = 25.58 %  ( when rounded off to two decimal places )

= 26 % ( when rounded off to the nearest whole number )

Please find the attached screenshot of the excel sheet containing the detailed calculation for the above solution.


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