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Find What is the IRR of the investment

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Reference no: EM132526274

You are considering a safe investment opportunity that requires a $1,090 investment today, and will pay $740 two years from now and another $850 five years from now.

Question a. What is the IRR of this investment?

Question b. If you are choosingbetween this investment and putting your money in a safe bank account that pays an EAR of 5% per year for any horizon, canyou make the decision by simply comparing this EAR with the IRR of the investment? Explain.

Reference no: EM132526274

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