A project has a series of non-normal cash flows that result in a terminal value (TV) of $25,000 in 10 years.If the project's initial costs are $7,500,what is your recommendation regarding this project to management (accept/reject)?
A)accept as the MIRR is 12.79%
B)reject as the MIRR is greater than zero
C)accept as the terminal value is greater than the present value of the costs
D)accept as the MIRR is 12.50%

Question

Quizplus · Accepted Answer

The Modified Internal Rate of Return (MIRR) being 12.79% indicates that the project's return exceeds its cost of capital, making it a worthwhile investment.

A Project Has a Series of Non-Normal Cash Flows That