Firm is considering investing in project with cash flows

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Reference no: EM131986778

Suppose your firm is considering investing in a project with the cash flows shown as follows, that the required rate of return on projects of this risk class is 8 percent, and the maximum allowable payback and discounted paback statistic for the project are three and three and a half years, respectively.

Time Cash Flow

0 -100,000

1 30,000

2 45,000

3 55,000

4 30,000

5 10,000

- Use the IRR decision rule to evaluate this project; should it be accepted or rejected and why?

Reference no: EM131986778

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