What is the irr of offer

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Reference no: EM132819939

1.) Suppose you are offered $10,600 today but must make the following payments:

YearCash Flows ($)0$ 10,600 1-4,900 2-4,400 3-3,400 4-2,700

What is the IRR of this offer?

2.) The Utah Mining Corporation is set to open a gold mine near Provo, Utah. According to the treasurer, Monty Goldstein, "This is a golden opportunity." The mine will cost $2,600,000 to open and will have an economic life of 11 years. It will generate a cash inflow of $365,000 at the end of the first year, and the cash inflows are projected to grow at 8 percent per year for the next 10 years. After 11 years, the mine will be abandoned. Abandonment costs will be $420,000 at the end of Year 11.

What is the IRR for the gold mine?

Reference no: EM132819939

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