A new computer system is expected to cost $40 million and generate annual savings of $12 million over the next five years.

What is the IRR for this investment?
A)11.18 percent.
B)12.98 percent.
C)15.24 percent.
D)12.00 percent.

Question

A new computer system is expected to cost $40 million and generate annual savings of $12 million over the next five years.

What is the IRR for this investment?
A)11.18 percent.
B)12.98 percent.
C)15.24 percent.
D)12.00 percent.

Quizplus · Accepted Answer

11efbab8_e672_da78_8e22_c7e82023ea38_TB1314_00
IRR = 15.24.

A New Computer System Is Expected to Cost $40 Million