Pregunta

  1. Find the IRR of an investment having initial cash outflow of Rs. 213,000. The cash inflows during the first, second, third and fourth years are expected to be Rs. 65,200, Rs. 96,000, Rs. 73,100 and Rs. 55,400 respectively.
    A)
    B)
    C)
    D)

Ask by Chang Pena. in Pakistan
Jan 19,2025

Solución de inteligencia artificial de Upstudy

Respuesta verificada por el tutor

Responder

The Internal Rate of Return (IRR) for the investment is approximately 14.05%.
Answer:
B)

Solución

¡Inicia sesión para desbloquear respuestas gratis!

Una plataforma de aprendizaje en la que confían millones de estudiantes y profesores reales.

star-icon Descubrir

Respondido por UpStudy AI y revisado por un tutor profesional

Bonus Knowledge

To find the IRR (Internal Rate of Return) for the investment, we can use the cash flows provided and set the net present value (NPV) equal to zero. The cash flows are as follows:
  • Initial Outflow (Year 0): Rs. 213,000
  • Inflow (Year 1): Rs. 65,200
  • Inflow (Year 2): Rs. 96,000
  • Inflow (Year 3): Rs. 73,100
  • Inflow (Year 4): Rs. 55,400
Using a financial calculator or Excel to compute the IRR, we input the cash flows corresponding to each year. By solving, we find that the IRR is approximately , which corresponds to option B.
Remember, the IRR is the discount rate that makes the NPV of all cash flows from the investment equal to zero, providing a benchmark to evaluate the potential return of the investment versus the costs.

preguntas relacionadas

\begin{tabular}{l|l}\multicolumn{1}{l}{ A variable that can't be accounted for is } & The author backs up the statement that the economy \\ can be unpredictable by pointing out that \\ a natural disaster such as a hurricane. As the & result of a hurricane, demand is guaranteed \\ to increase in a way that could not have been & (A) banking panics occur when confidence in the financial \\ system is strong. \\ predicted because the flow of goods into & (B) natural disasters can affect the demand for goods and \\ disrupt production. \\ impacted areas is blocked. If crops or power \\ facilities like oil refineries are damaged, then & C. customers are more willing to buy something when \\ interest rates are low. \\ demand is also affected. & (D) inflation occurs when prices for goods and services \\ decrease too quickly. \end{tabular}

Latest Economics Questions

\begin{tabular}{l|l}\multicolumn{1}{l}{ A variable that can't be accounted for is } & The author backs up the statement that the economy \\ can be unpredictable by pointing out that \\ a natural disaster such as a hurricane. As the & result of a hurricane, demand is guaranteed \\ to increase in a way that could not have been & (A) banking panics occur when confidence in the financial \\ system is strong. \\ predicted because the flow of goods into & (B) natural disasters can affect the demand for goods and \\ disrupt production. \\ impacted areas is blocked. If crops or power \\ facilities like oil refineries are damaged, then & C. customers are more willing to buy something when \\ interest rates are low. \\ demand is also affected. & (D) inflation occurs when prices for goods and services \\ decrease too quickly. \end{tabular}
¡Prueba Premium ahora!
¡Prueba Premium y hazle a Thoth AI preguntas de matemáticas ilimitadas ahora!
Quizas mas tarde Hazte Premium
Estudiar puede ser una verdadera lucha
¿Por qué no estudiarlo en UpStudy?
Seleccione su plan a continuación
Prima

Puedes disfrutar

Empieza ahora
  • Explicaciones paso a paso
  • Tutores expertos en vivo 24/7
  • Número ilimitado de preguntas
  • Sin interrupciones
  • Acceso completo a Respuesta y Solución
  • Acceso completo al chat de PDF, al chat de UpStudy y al chat de navegación
Básico

Totalmente gratis pero limitado

  • Solución limitada
Bienvenido a ¡Estudia ahora!
Inicie sesión para continuar con el recorrido de Thoth AI Chat
Continuar con correo electrónico
O continuar con
Al hacer clic en "Iniciar sesión", acepta nuestros términos y condiciones. Términos de Uso & Política de privacidad