What roots are there for the pw equation

Reference no: EM132162719

Question: Calculate the MIRR for Problem if the external financing rate is 8% and the external investing rate is 15%.

Problem: A coal deposit can be mined more rapidly if a third dragline and conveyor system is added. The initial cost would be $1.5M. Annual revenues for each of the next 12 years would increase from $800K to $1200K, and then for the next 6 years, revenues would drop from $800K to $0. Thus, the mining is 50% faster, and the deposit is depleted 6 years earlier. The system will have no salvage value. What roots are there for the PW equation? Is there a meaningful IRR? Is the third dragline economically attractive if i is 20%? Graph the PW for interest rates of 0% to 100%?

Reference no: EM132162719

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