An investment has the following cash flows. Should the project be accepted if it has been assigned a required return of $9.5 \%$ ? Why or why not?

A)yes; because the IRR exceeds the required return by about 0.39%.
B)yes; because the IRR is less than the required return by about 3.9%.
C)yes; because the IRR is positive.
D)no; because the IRR exceeds the required return by about 3.9%.
E)no; because the IRR is 9.89%.

Question

An investment has the following cash flows. Should the project be accepted if it has been assigned a required return of $9.5 \%$ ? Why or why not?

A)yes; because the IRR exceeds the required return by about 0.39%. 
B)yes; because the IRR is less than the required return by about 3.9%. 
C)yes; because the IRR is positive. 
D)no; because the IRR exceeds the required return by about 3.9%. 
E)no; because the IRR is 9.89%.

Quizplus · Accepted Answer

The question is asking whether the project should be accepted with a required return of 9.5%. The Internal Rate of Return (IRR) is 9.89%, which is higher than the required return. Since the IRR exceeds the required return, the project should be accepted. Choice A correctly states this conclusion, as it notes that the IRR exceeds the required return by about 0.39%.

An Investment Has the Following Cash Flows 9.5%9.5 \%9.5% ? Why or Why Not? A)yes; Because the Be

An Investment Has the Following Cash Flows $9.5 \%$ ? Why or Why Not?

A)yes; Because the Be