Determine the irr to the nearest second decimal place

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1. Given cash flows for an investment of $5,800 at time 0, determine the IRR to the nearest second decimal place.

(Hint: Try 10% and 12% and Interpolate)

Year 0 1 2 3 4
Cash Flow -$5,800 $1,800 $1,800 $1,800 $2,000

2. Two hazardous environment facilities are being evaluated, with the projected life of each facility being 10 years. The cash flows are as follows:

Alternative A Alternative B
First cost $615,000 $300,000
Maintenance and operating cost $10,000 $25,000
Annual benefits $158,000 $92,000
Salvage value $65,000 -$5,000

3. The company uses a MARR of 15%. Using rate of return analysis, which alternative should be selected?

Reference no: EM13746209

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