A company is considering investing in a new machine that requires a cash payment of $43,158 today. The machine will generate annual cash flows of $17,050 for the next three years.
What is the internal rate of return if the company buys this
machine? (PV of $1, FV of $1, PVA of $1, and FVA of $1)
(Use appropriate factor(s) from the tables
provided.)
Calculate IRR
Amount invested | / | Annual net cash flow | = | Present value of factor |
43158 | / | 17050 | = | 2.53126 |
IRR | = | 9% | ||
A company is considering investing in a new machine that requires a cash payment of $43,158 today. The machine will gene...
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