Determine the projects irr suppose the initial investment

Reference no: EM13472522

The hospital's marketing and finance departments have just provided you, as chief financial officer, with pro forma income statements for your proposed sonogram center. These statements appear in the following.

Pro forma Income Statement (000)

Time t + 1 t + 2 t + 3 t + 4

Service Revenues (net) $425 $500 $580 $700

Expenses $400 $450 $525 $600

Depreciation Expense $35 $35 $35 $35

Net Income ($10) $15 $20 $65

What is the project's IRR? Assume an initial investment of $175,000 and an appropriate discount rate of 6%. The hospital is operated as a not-for-profit facility.

Reference no: EM13472522

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