Define the internal rate of return

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Reference no: EM131606563

Suppose your firm is considering investing in a project with the accompanying cash flows, that the required rate of return on projects of this risk class is 11 percent, and that the maximum allowable payback and discounted payback statistics for your company are 4 and 4.5 years, respectively. Time Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Cash Flow -$125,000 -$75,650 $75,000 $49,000 $115,000 $81,850 What is the Internal Rate of Return? Would you accept or reject this project? Why?

Reference no: EM131606563

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