Question

A project has the following total (or net) cash flows.                __________________________________________            &nbs

A project has the following total (or net) cash flows.

               __________________________________________

              Year          Total (or net) cash flow

               _________________________________________

1 $20,000
2 30,000
3 50,000
4 60,000
_________________________________________

The required rate of return on the project is 15 percent. The initial investment (or initial cost or initial outlay) of the project is $80,000.
a) Find the net present value (NPV) of the project.
b) Find the profitability index (PI) of the project.
c) Calculate the modified internal rate of return (MIRR) of the project.

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