A firm evaluates all of its projects by applying the irr rule. year cash flow 0 −$157,300 1 74,000 2 87,000 3 46,000 a. what is the project\'s irr? (do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) b. if the required return is 11 percent, should the firm accept the project?
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Based on the cashflows for the firm then its IRR can be found to be 16.26%. With the given required return, the firm should accept project.
What is the IRR?
The IRR can be found using a Spreadsheet with the IRR function:
= 16.26%
Should the project be accepted?
The IRR rule is that if the IRR is greater than the project's required return, the firm can accept the project.
The IRR of 16.26% is greater than the required return of 11% so the firm should accept this project.
Find out more on IRR at https://brainacademy.pro/question/14407038.