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    Important information about Project's IRR

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    The capital budgeting director of Sparrow Corporation is evaluating a project that costs $200,000, is expected to last for 10 years and produce after-tax cash flows, including depreciation, of $44,503 per year. If the firm's cost of capital is 14 percent and its tax rate is 40 percent, what is the project's IRR?

    Choices of answers:

    8%

    14%

    18%

    -5%

    12%

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    Solution Preview

    The capital budgeting director of Sparrow Corporation is evaluating a project that costs $200,000, is ...

    Solution Summary

    This provides the steps to calculate the project's IRR.

    $2.19

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