Question

Rieger International is evaluating the feasibility of investing

​$104 comma 000104,000

in a piece of equipment that has a

55​-year

life. The firm has estimated the cash inflows associated with the proposal as shown in the following​ table:

LOADING...

. The firm has a

1111​%

cost of capital.

a.  Calculate the payback period for the proposed investment.

b.  Calculate the net present value​ (NPV) for the proposed investment.

c.  Calculate the internal rate of return

​(IRR)​,

rounded to the nearest whole​ percent, for the proposed investment.

d.  Evaluate the acceptability of the proposed investment using NPV and IRR. What recommendation would you make relative to implementation of the​ project

1	40000
2	35000
3	25000
4	35000
5	25000

Answer 1