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Determine the net present value of the investment proposal

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Reference no: EM132009919

Question - NPV and IRR: Unequal Annual Net Cash Inflows

Assume that Goodrich Petroleum Corporation is evaluating a capital expenditure proposal that has the following predicted cash flows:
Initial Investment ($82,850)

Operation

Year 1 30,000

Year 2 50,000

Year 3 40,000

Salvage 0

Required:

a. Using a discount rate of 12 percent, determine the net present value of the investment proposal.

b. Determine the proposal's internal rate return.

Reference no: EM132009919

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