Mining company is deciding whether to open strip mine

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A mining company is deciding whether to open a strip mine, which costs $2.5 million. Cash inflows of $12.5 million would occur at the end of Year 1. The land must be returned to its natural state at a cost of $12.5 million, payable at the end of Year 2.

a) What is the project's MIRR at WACC = 10%? Round your answer to two decimal places. Do not round your intermediate calculations.

b) What is the project's MIRR at WACC = 20%? Round your answer to two decimal places. Do not round your intermediate calculations.

Reference no: EM131530929

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