Evaluating project that would require initial investment

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1. Middlefield Motors is evaluating a project that would require an initial investment of 81,295 dollars today. The project is expected to produce annual cash flows of 6,367 dollars each year forever with the first annual cash flow expected in 1 year. The NPV of the project is 427 dollars. What is the IRR of the project? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.

2. Gomi Waste Disposal is evaluating a project that would last for 4 years. The project’s internal rate of return is 9.62 percent; its NPV is 4,720 dollars; and the expected cash flows are -75,900 dollars at time 0, 17,300 dollars in 1 year, 58,600 dollars in 2 years, and X in 4 years. What is X?

Reference no: EM131891520

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