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Calculate internal rate of return by trial

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Fraiser International has decided to purchase a pressing machine for Rs. 1,000,000. The machine is expected to generate a cash flow of Rs. 25,000 per month and requires a monthly cost of Rs. 8,000 to run. The expected useful life of the machine is 15 years with no salvage value. The discount rate is 8%. Please calculate NPV and advise Fraiser International about WHY they should invest or reject the project. What does IRR of 20% per year represent for an investment opportunity you are considering to invest? Calculate Internal Rate of Return by Trial & Error method (show 3 attempts). Arrange the Projects in based on their profitability index (PI). How profitability index helps financial manager make better investment decision?

Reference no: EM132546577

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