) Compute the internal rate of return (IRR) for the following cash flows. Show the equation used using Appendix C notation: (Chapter 7)
Year Alt A
0 -$2,217
1 $0
2 $0
3 $500
4 $700
5 $900
6 $1,100
Answer
Given Cash flow
Year | Cash flow CFi |
0 | -2217 |
1 | 0 |
2 | 0 |
3 | 500 |
4 | 700 |
5 | 900 |
6 | 1100 |
Ler r be the IRR
CF0 + Cf1/(1+r)^1+ Cf2/(1+r)^2+ Cf3/(1+r)^3+ Cf4/(1+r)^4+ Cf5/(1+r)^5+ Cf6/(1+r)^6=0
-2217+0/(1+r)+0/(1+r)^2+500/(1+r)^3+700/(1+r)^4+900/(1+r)^5+1100/(1+r)^6=0
Solving for r we get r =8.00%
) Compute the internal rate of return (IRR) for the following cash flows. Show the equation...
please show work
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