A project is expected to have annual cash flows of $36,800,$24,600,and -$9,200 for Years 1 to 3,respectively.The initial cash outlay is $44,500 and the discount rate is 11 percent.What is the modified IRR?
A)14.66%
B)13.22%
C)12.73%
D)18.67%
E)15.70%

Question

Quizplus · Accepted Answer

Modified Year 2 cash flow = $24,600 + (-$9,200)/ 1.11 = $16,311.71 $0 = -$44,500 + $36,800 / (1 + MIRR)+ $16,311.71 / (1 + MIRR)² MIRR = 0.1466,or 14.66%

A Project Is Expected to Have Annual Cash Flows of $36,800,$24,600,and