What is the IRR for the following project if its initial after-tax cost is $5,000,000 and it is expected to provide after-tax operating cash inflows of $1,800,000 in year 1, $1,900,000 in year 2, $1,700,000 in year 3, and $1,300,000 in year 4?
A) 15.57%
B) 0.00%
C) 13.57%
D) 12.25%

Question

Quizplus · Accepted Answer

The Internal Rate of Return (IRR) is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. To find the IRR, one typically uses financial calculators, spreadsheet software like Excel, or iterative mathematical methods, as it involves solving for the root of a polynomial equation. Given the cash flows, the IRR for this project is approximately 13.57%.

What Is the IRR for the Following Project If Its