A project that costs 3,000 will provide annual cash flows of $800 for each of the next 6 years. Is this project worth pursuing if the discount rate is 10%? How high can the discount rate be before you reject the project?
See attached for detailed response.
For a project to be rejected, the NPV must be equal or less than zero.
To find the highest ...
The solution looks at "NPV" and "IRR".