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Compute the project modified internal rate of return

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Problem - Rascal Clothing is evaluating a new weaving machine that costs $90,000. It is expected that the machine will generate after-tax cash flows equal to $54,000 per year for two years. Rascal's required rate of return is 9 percent.

(a) Compute the project's internal rate of return (IRR)?

(b) Compute the project's modified internal rate of return (MIRR).

(c) Should the project be purchased?

Reference no: EM132698522

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