P10-16 Internal rate of return For each of the projects shown below, calculate the internal rate of
return (IRR). If the cost of capital is 13%, indicate whether each project is acceptable according to
IRR.
Project A
Project B
Project C
Initial investment (CFO)
-$90,000
-$490,000
-$35,000
Project D
-$276,000
Year (t)
Cash inflows (CF$_t$)
1
$20,000
$150,000
$7,500
$120,000
2
25,000
150,000
7,500
100,000
3
30,000
150,000
7,500
80,000
4
35,000
150,000
7,500
60,000
5
40,000
7,500
