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    Modified Internal Rate of Return (MIRR) of Taylor Technologies

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    2.) Taylor Technologies has a target capital structure, which is 40% debt and 60% equity. The equity will be financed with retained earnings. The company's bonds have a yield to maturity of 10%. The company's stock has a beta=1.1. The risk-free rate is 6%, the market risk premium is 5%, and the tax rate is 30%. The company is considering a project with the following cash flows:

    (see chart in the attached file)

    What is the project's modified internal rate of return (MIRR)?

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    2.) Taylor Technologies has a target capital structure, which is 40% debt and 60% equity. The equity will be financed with retained earnings. The company's bonds have a yield to maturity of 10%. The company's stock has a beta=1.1. The risk-free rate is 6%, the market risk premium is 5%, and the tax rate is 30%. The company is considering a project with the following cash flows:

    Year Project Cash ...

    Solution Summary

    The solution explains how to calculate the modified internal rate of return (MIRR).

    $2.19

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