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If you know that the project has a regular payback of 2.1 years, what is the project’s IRR?
(Calculating IRR, payback, and a missing cash flow) The Merriweather Printing Company is trying to decide on the merits of co
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Answer #1

Pay Back periods = Years before recovery + Cost not covered in that year/ Cash flow for that year=2.1
2.1 =2+(Investment-760000-370000)/290000
Investment =0.1*290000+760000+370000 =1159000

Using financial calculator to calculate IRR
CF0=-1159000;CF1=760000;CF2=370000;CF3=290000;CF4=510000;CPT IRR =27.36%

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