Find what internal rate of return of investment is closest

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Reference no: EM132711259

Joetz Corporation has gathered the following data on a proposed investment project (Ignore income taxes.):

Investment required in equipment $40,000

Annual cash inflows $10,000

Salvage value of equipment $0

Life of the investment 15years

Required rate of return 10%

The company uses straight-line depreciation on all equipment. Assume cash flows occur uniformly throughout a year except for the initial investment.

Problem 1: What The internal rate of return of the investment is closest to:

Multiple Choice

Option 1: 26%

Option 2: 24%

Option 3: 22%

Option 4: 28%

Reference no: EM132711259

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