(Net present value calculation) Big Steve\'s markers of swizzle sticks, is consi

Question

(Net present value calculation) Big Steve's markers of swizzle sticks, is considering the purchase of a new plastic stamping machine. This investment requires an initial outlay of $90,000 and will generate net cash inflows of $19,000 per year for 11 years. What is this project's internal rate of return? (Round to two decimal places, provide solution, and explain how you get internal rate of return percentage) (Net present value calculation) Big Steve's markers of swizzle sticks, is considering the purchase of a new plastic stamping machine. This investment requires an initial outlay of $90,000 and will generate net cash inflows of $19,000 per year for 11 years. What is this project's internal rate of return? (Round to two decimal places, provide solution, and explain how you get internal rate of return percentage)

Explanation / Answer

Year Cash Flows 0 -$90,000 1 $19,000 2 $19,000 3 $19,000 4 $19,000 5 $19,000 6 $19,000 7 $19,000 8 $19,000 9 $19,000 10 $19,000 11 $19,000 IRR 17.54% IRR is calculated in Excel using IRR function..IRR(cashflows 0 to 11)

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