Chasteen,Inc.is considering an investment with an initial cost of $185,000 that would be depreciated straight-line to a zero book value over the life of the project.The cash inflows generated by the project are estimated at $76,000 for the first two years and $30,000 for the following two years.What is the internal rate of return?
A)6.44 percent
B)6.94 percent
C)7.43 percent
D)7.55 percent
E)8.11 percent

Question

Quizplus · Accepted Answer

The IRR is defined as the interest rate that makes the NPV equal zero.