Will Alcan accept the project

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Question - Alcan, Inc. is considering a project that has an initial outlay or cost of $220,000. The respective future cash inflows from its four-year project for years 1 through 4 are: $50,000, $60,000, $70,000, and $80,000, respectively. Alcan uses the internal rate of return method to evaluate projects. Will Alcan accept the project if its hurdle rate is 12%?

1- Alcan will not accept this project because its IRR is about 7.63%.

2- Alcan will not accept this project because its IRR is about 6.50%.

3- Alcan will not accept this project because its IRR is about 9.74%.

4- Alcan will not accept this project because its IRR is about 4.66%.

Reference no: EM132863210

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