# Online professor's response to: NPV and IRR

Not what you're looking for?

Benson Designs has prepared the following estimates for a long-term project it is considering. The initial investment is $18,250, and the project is expected to yield after-tax cash inflows of $4,000 per year for 7 years. The has a 10% cost of capital.

a) Determine the net present value (NPV) for the project

b) Determine the internal rate of return (IRR) for the project

c) Would you recommend that the firm accept or reject the project? Explain your answer.

##### Purchase this Solution

##### Solution Summary

Determines the NPV and IRR of a project.

##### Solution Preview

The answer is in the attached file.

Benson Designs has prepared the following estimates for a long-term project it is considering. The initial investment is $18,250, and the project is expected to yield after-tax cash inflows of $4,000 per year for 7 years. The has a 10% cost of capital.

a) Determine the net present value (NPV) for the project

Since the cash inflows are the same over the years (it is an annuity) we can use PVIFA to calculate NPV

PVIFA= Present ...

##### Purchase this Solution

##### Free BrainMass Quizzes

##### Writing Business Plans

This quiz will test your understanding of how to write good business plans, the usual components of a good plan, purposes, terms, and writing style tips.

##### Employee Orientation

Test your knowledge of employee orientation with this fun and informative quiz. This quiz is meant for beginner and advanced students as well as professionals already working in the HR field.

##### Lean your Process

This quiz will help you understand the basic concepts of Lean.

##### Operations Management

This quiz tests a student's knowledge about Operations Management

##### Cost Concepts: Analyzing Costs in Managerial Accounting

This quiz gives students the opportunity to assess their knowledge of cost concepts used in managerial accounting such as opportunity costs, marginal costs, relevant costs and the benefits and relationships that derive from them.