Question

Quaku began his investing program with a $7,000 initial investment and was repaid his initial investment...

Quaku began his investing program with a $7,000 initial investment and was repaid his initial investment at the end of year three. During this period he made $1,000, by the end of year one, $1,500 ending year two and $2,000 ending year three. What is his IRR for this investment?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Solution:

The IRR for this Investment = 20.54 %

Please find the attached screenshot of the excel sheet containing the detailed calculation for the solution.

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
You are investing in a new business known informally as Zombiebook. The initial investment is $5...
You are investing in a new business known informally as Zombiebook. The initial investment is $5 million. Future cash flows are projected to be $2 million at the end of years one, two, three, and four. A different business in which you are considering investing is called Angry Rabbits. It too would cost $5 million. Future cash flows for Angry Rabbits are projected to be $1 million at the end of years one, two, and three, followed by a positive...
Alfonso began the year with a tax basis in his partnership interest of $30,000. His share...
Alfonso began the year with a tax basis in his partnership interest of $30,000. His share of partnership debt at the beginning and end of the year consists of $4,000 of recourse debt and $6,000 of nonrecourse debt. During the year, he was allocated $40,000 of partnership ordinary business loss. Alfonso does not materially participate in this partnership and he has $1,000 of passive income from other sources. a. How much of Alfonso’s loss limited by his tax basis? b....
The Beans Corporation is considering investing in a project with an initial cash investment of $180,000...
The Beans Corporation is considering investing in a project with an initial cash investment of $180,000 that provides an annual cash inflow of $40,000 in Years 1-3, then $25,000 per year in Years 4-5, and $50,000 per year in Years 6-8. The PAYBACK PERIOD for this project is: Select one: a. 5.8 years b. 5.6 years c. 5.2 years d. 5.4 years
You are considering a project that has an initial investment of $8,300 with an initial time...
You are considering a project that has an initial investment of $8,300 with an initial time period of 3 years. The cash flows would be provided semiannually, already adjusted for taxes, as shown in the table below. At the end of the project, you require a 12% annual return, which is 6% semiannually. (Your answer should be to two decimal places.) Year 1 Jan - June $1,200 1 Jul - Dec $1,500 2 Jan - June $1,100 2 Jul -...
Hawkeye Corp has two investment opportunities with the following cash flows and IRRs. Hawkeye’s required return...
Hawkeye Corp has two investment opportunities with the following cash flows and IRRs. Hawkeye’s required return on each project is 9%. The projects are not mutually exclusive, so Hawkeye could invest in both projects if it wants to. Which projects should Hawkeye invest in using NPV? Year 0 Year 1 Year2 Project A -$6,000 $1,500 $6,500 Project B $2,000 -$1,000 -$1,500 Group of answer choices Both projects A and B Only project B Only project A Neither project Mass Company...
You are deciding between two mutually exclusive investment opportunities. Both require the same initial investment of...
You are deciding between two mutually exclusive investment opportunities. Both require the same initial investment of $11.0 million. Investment A will generate $2.40 million per year (starting at the end of the first year) in perpetuity. Investment B will generate $1.70 million at the end of the first year, and its revenues will grow at 3.2% per year for every year after that. Which investment has the higher IRR ? Which investment has the higher NPV when the cost of...
A project requires an initial investment of $2,200 and grants cash flows of $1,300 at the...
A project requires an initial investment of $2,200 and grants cash flows of $1,300 at the end of year 1, $ 950 at the end of year 2, $ 1,900 at the end of year 3 and $ 850 at the end of year 4. At a discount rate of 32%, calculate NPV and IRR. What decision should be made by the company? please provide me the answer as soon as possible
1) You expect to receive $7,000 at graduation in two years. You plan on investing it...
1) You expect to receive $7,000 at graduation in two years. You plan on investing it at 10 percent until you have $103,000. How long will you wait from now 2)Although appealing to more refined tastes, art as a collectible has not always performed so profitably. During 2016, a sculpture was sold at auction for a price of $10,316,500. Unfortunately for the previous owner, he had purchased it in 2012 at a price of $12,379,500. What was his annual rate...
Marian Cebrian owns his own business and is considering an investment. If he undertakes the investment,...
Marian Cebrian owns his own business and is considering an investment. If he undertakes the investment, it will pay $6,840 at the end of each of the next 33 years. The opportunity requires an initial investment of $1,710 plus an additional investment at the end of the second year of $8,550. What is the NPV of this opportunity if the interest rate is 2.6% per year? Should Marian take it? Select one: a. The NPV is $9,665. Yes, he should...
21. The Payback period is the length of time required to recover the initial investment. you...
21. The Payback period is the length of time required to recover the initial investment. you should use payback period to evaluating two mutually exclusive projects The Payback period considers risk of the project The Payback period treat $1,000 received in year 1 the same as the one received in year 3 The Payback period treat $1,000 received in year 1 different than the one received in year 3
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT