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A company is considering purchasing equipment costing $70,000. The equipment is expected to reduce costs from...

A company is considering purchasing equipment costing $70,000. The equipment is expected to reduce costs from year 1 to 4 by $8500, year 5 to 10 by $12,000, and in year 11 by $5000. In year 11, the equipment can be sold at a salvage value of $10,000. Calculate the internal rate of return (IRR) for this proposal.

ANS:

IRR= 9.4%

*note: asking how to get to the answer from a TI BA II PLUS financial calculator. Thank you!

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Answer #1

Big 18 A ve B _ C D E F G H Press the following button and input value accordingly Hami Input Output 70000 Button CF +1- ENTE

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