Simms Corp. is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's projected IRR can be less than the WACC or negative, in both cases it will be rejected. Year 0123 Cash flow -$1000 $425 $425 $425 a. 13.87% b. 13.21% c. 15.29% d. 12.55% e. 14.56%
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Step 1
The IRR is the discount rate that makes the net present value (NPV) of all cash flows from a particular project equal to zero. In this case, we are looking for the IRR of Simms Corp.'s project based on the given cash flows. Show more…
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