Question

Growth Enterprises believes its latest project, which will cost $84,000 to install, will generate a perpetual growing stream of cash flows. Cash flow at the end of the first year will be $9,000, and cash flows in future years are expected to grow indefinitely at an annual rate of 4%. |

a. |
If the discount rate for this project is 10%, what is the
project NPV? |

NPV | $ |

b. |
What is the project IRR? |

IRR | % |

Answer #1

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