Present worth of cash flows as function of interest rate

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Reference no: EM131847873

Consider an investment with the following cash flows:

First cost -$1 million

Year 1 $1 million

Year 2 $1.1 million

Year 3 $1.3 million

Year 4 $1 million

Year 5 -$3.7 million

(a) Check for multiple rates of return.

(b) Find all rates of return between 0% and 100%. Hint: One way to do that is to plot the present worth of the cash flows as a function of the interest rate.

Reference no: EM131847873

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