Hart CorpIs Considering a Project That Has the Following Cash Flow

question 26

Multiple Choice

Hart Corp.is considering a project that has the following cash flow data.What is the project's IRR? Note that a project's IRR can be less than the cost of capital or negative, in both cases it will be rejected. $$\begin{array} { l c c c c } \text { Year } & 0 & 1 & 2 & 3 \\\hline \text { Cash flows } & - \$ 1,000 & \$ 425 & \$ 425 & \$ 425\end{array}$$

• A) 12.55%
• B) 13.21%
• C) 13.87%
• D) 14.56%
• E) 15.29%

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Definitions:

Information-Processing Theory

A cognitive approach that likens the mind to a computer, focusing on how information is taken in, stored, and retrieved.

Memory

The process by which information is encoded, stored, and retrieved, allowing experiences to be remembered over time.

Sensory Memory

The shortest-term element of memory, which allows the ability to retain impressions of sensory information after the original stimuli have ended.

Sensory Memory

The shortest-term element of memory, which allows individuals to retain impressions of sensory information after the original stimulus has ceased.