Question

28. What is the modified internal rate of return (MIRR) for the following project? The cost of capital is 10%.

Time |
0 |
1 |
2 |
3 |

Project A |
-$350 |
$300 |
-$100 |
$200 |

a. 10.35%

b. 9.18%

c. 10.25%

d. 8.50%

31. Simkins Renovations Inc. is considering a project that has the following cash flow data. What is the project's IRR?

Year |
0 |
1 |
2 |
3 |
4 |

Cash flows |
-$825 |
$296 |
$285 |
$300 |
$320 |

a. 16.65%

b. 14.61%

c. 17.24%

d. 13.59%

Answer #1

8. Modified internal rate of return (MIRR)
The IRR evaluation method assumes that cash flows from the
project are reinvested at the same rate equal to the IRR. However,
in reality the reinvested cash flows may not necessarily generate a
return equal to the IRR. Thus, the modified IRR approach makes a
more reasonable assumption other than the project's IRR.
Consider the following situation :
Cute Camel Woodcraft Company is analyzing a project that
requires an initial investment of $3,225,000....

What is the Modified Internal Rate of Return (MIRR) for the
following cash flows? Assume that the required rate of return is
4%
Year
CFs
0
-1,000
1
100
2
200
3
350
4
800

Modified internal rate of return (MIRR)
The IRR evaluation method assumes that cash flows from the
project are reinvested at the same rate equal to the IRR. However,
in reality the reinvested cash flows may not necessarily generate a
return equal to the IRR. Thus, the modified IRR approach makes a
more reasonable assumption other than the project’s IRR.
Consider the following situation:
Fuzzy Button Clothing Company is analyzing a project that
requires an initial investment of $500,000. The project’s...

4. Modified internal rate of return (MIRR)
The IRR evaluation method assumes that cash flows from the
project are reinvested at the same rate equal to the IRR. However,
in reality the reinvested cash flows may not necessarily generate a
return equal to the IRR. Thus, the modified IRR approach makes a
more reasonable assumption other than the project’s IRR.
Consider the following situation:
Green Caterpillar Garden Supplies Inc. is analyzing a project
that requires an initial investment of $2,500,000....

4. Modified internal rate of return (MIRR)
The IRR evaluation method assumes that cash flows from the
project are reinvested at the same rate equal to the IRR. However,
in reality the reinvested cash flows may not necessarily generate a
return equal to the IRR. Thus, the modified IRR approach makes a
more reasonable assumption other than the project’s IRR.
Consider the following situation:
Green Caterpillar Garden Supplies Inc. is analyzing a project
that requires an initial investment of $3,225,000....

4. Modified internal rate of return (MIRR)
The IRR evaluation method assumes that cash flows from the
project are reinvested at the same rate equal to the IRR. However,
in reality the reinvested cash flows may not necessarily generate a
return equal to the IRR. Thus, the modified IRR approach makes a
more reasonable assumption other than the project’s IRR.
Consider the following situation:
Cold Goose Metal Works Inc. is analyzing a project that requires
an initial investment of $500,000....

Sam Corp. is considering a project that has the following cash
flow data. What is the project's IRR (Internal Rate of
Return)? Note that a project's projected IRR can be less than the
weighted average cost of capital (WACC) or negative, in both cases
it will be rejected. Show work.
Year 0 1 2 3 4
Cash
flows -$1,900 $600 $825 $950 -$50
Helmand Inc. is considering a project that has the following
cash flow and WACC data. What is the project's
MIRR? Note that a project's projected MIRR can be less
than...

Find the modified internal rate of return (MIRR) for the
following series of future cash flows if the company is able to
reinvest cash flows received from the project at an annual rate of
13.72 percent.The initial outlay is $470,600.
Year 1: $185,900
Year 2: $185,100
Year 3: $125,700
Year 4: $183,400
Year 5: $184,100
Round the answer to two decimal places in percentage
form.
How do I do this in excel?

Find the modified internal rate of return (MIRR) for the
following series of future cash flows if the company is able to
reinvest cash flows received from the project at an annual rate of
12.92 percent. the initial outlay is $439,500.
Year 1: $130,600
year 2: 178,600
year3: 147,800
Year 4: 133,600
Year 5: 155,700
Round answer to two decimal places.

Internal rate of return For the project shown in the
following table, calculate the internal rate of return
(IRR). Then indicate, for the project, the maximum cost of
capital that the firm could have and still find the IRR
acceptable.
Initial investment $160,000
Year (t) Cash inflows
1 $35,000
2 $25,000
3 $45,000
4 $45,000
5 $45,000
The project's IRR is?
The maximum cost of capital that the firm could have and still
find the IRR acceptable is?

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