Generate a perpetual growing stream of cash flows

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Growth Enterprises believes its latest project, which will cost $82,000 to install, will generate a perpetual growing stream of cash flows. Cash flow at the end of the first year will be $7,000, and cash flows in future years are expected to grow indefinitely at an annual rate of 5%.

a. If the discount rate for this project is 10%, what is the project NPV? (Do not round intermediate calculations.)

b. What is the project IRR? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

Reference no: EM131450979

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