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What is the annualized hpr of the project

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Reference no: EM133072919

A firm considers undertaking an investment project with the following cash flows: initial machine purchase: $20,000; a cash refund on part of the machine of $2000 in year one; revenue from sales of production of $12,000 in year two and $13,500 in year three. At the end of year three it sells the machine for $2,300. Suppose the firm can reinvest any cash flows received during the project at 8%.

Question 1: What is the annualized HPR of the project?

Question 2: What is the IRR of the project?

Reference no: EM133072919

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