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Calculate the internal rate of return for each project

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Salarian Company is considering two capital expenditures. Relevant data for the projects are as follows:

Project                                 A                       B

Initial investment            $207,545       $262,102

Annual income               $49,270           $45,610

Life of project5 years      8 years

Salvage value                    $0                   $0

Salarian Company uses the straight-line method to depreciate its assets.

Question 1: Calculate the internal rate of return for each project. (For calculation purposes, use 4 decimal places as displayed in the factor table provided, e.g. 1.2512. Round answers to 0 decimal places, e.g. 15%.)

 

Reference no: EM132608218

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