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Manheim Candles is considering a project with the following incremental cash flows. Assume a discount rate...

Manheim Candles is considering a project with the following incremental cash flows. Assume a discount rate of​ 10%.

Year                                                              Cash Flow

0                                                                                 ​($20,000)

1                                                                                 0

2                                                                                 ​$30,000

3                                                                                 ​$30,000

Calculate the​ project's MIRR.​ (Round to the nearest whole​ percentage.)

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Answer #1

MIRR = (FV of Cash Inflow/PV of Cash outflow)1/n - 1

FV of Cash Inflow = 30000(1.10) + 30000

FV of Cash inflow = $63,000

MIRR = (63000/20000)1/3 - 1

MIRR = 46.59%

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