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    Investment: The Internal Rate of Return

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    Please use Excel showing a cash flow time line to provide the internal rate of return on an investment with the following cash flows:

    Year Cash Flow
    0 -$123,400
    1 $36,200
    2 $54,800
    3 $48,100

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    Solution Preview

    We use the Excel command "=IRR()" to compute the IRR. It is not possible to compute manually.
    We then ...

    Solution Summary

    This solution finds the internal rate of return on an investment based on specific cash flows.