Should the company carry out the investment

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A company said it plans to spend $20.7 million in expanding its fiber-optic Internet and television network. It will make the company more competitive than other TV providers and will generate net annual revenue of $4.35 million per year. And the salvage value will be $3 million after the 15 year project life.

a) Determine the IRR for the company. Please use interpolation.

b) If the company requires at least a 10% return on its investments, should the company carry out the investment? Why?

Reference no: EM131164985

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