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Exercise 25-13A Internal rate of return LO P4

Exercise 25-13A Internal rate of return LO P4

Exercise 25-13A Internal rate of return LO P4

Following is information on two alternative investments being considered by Tiger Co. The company requires a 5% return from its investments.
 

  Project X1 Project X2
Initial investment   $ (102,000 )     $ (164,000 )  
Expected net cash flows in year:                    
1     36,000         76,500    
2     46,500         66,500    
3     71,500         56,500    
 

 
Compute the internal rate of return for each of the projects using excel functions and based on internal rate of return, indicate whether each project is acceptable. (Round your answers to 2 decimal places.)

manish jayant 10-Sep-2020

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