Spence Company Is Considering a Project That Has the Following $\begin{array}{lcccc}\text { Year } & 0 & 1 & 2 & 3&4 \\\hline\text { Cash flows } & -\$ 1.050 & \$ 400 & \$ 400 & \$ 400& \$ 400\end{array}$

question 15

Multiple Choice

Spence Company 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 WACC or negative,in both cases it will be rejected. $\begin{array}{lcccc}\text { Year } & 0 & 1 & 2 & 3&4 \\\hline\text { Cash flows } & -\$ 1.050 & \$ 400 & \$ 400 & \$ 400& \$ 400\end{array}$

• A) 14.05%
• B) 15.61%
• C) 17.34%
• D) 19.27%
• E) 21.20%

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Definitions:

Traditional Authority

A form of leadership in which authority is legitimized by customs and historical precedent.

Lateral Decision Making

A decision-making process that involves collaboration among team members or departments at the same organizational level, rather than following a top-down approach.

Team Culture

The shared values, practices, and norms that shape the behavior and interaction of team members within an organization.

Creative Teamwork

The collaborative effort of a group to generate innovative solutions and ideas through collective creativity.