Pari Corporation Is Planning a 20 Year Project with an Initial

question 16

Multiple Choice

Pari Corporation is planning a 20 year project with an initial investment of $10 million.The project will have $50,000 cash outflows per year in years 1-4; $300,000 cash inflows in years 5-15, and $15,000 cash inflows in years 16-20.Determine the projects rate of return.

• A)-10.57%
• B)-9.81%
• C)-5.51%
• D)10.92%

---

Definitions:

Merchandise Inventory

Goods a company intends to sell to customers, typically in a retail or wholesale setting.

Replacement Price

The current cost of replacing an asset or inventory with a similar item.

Income-Sharing Ratio

The predetermined formula used among business partners or within an organization to divide profits or losses among stakeholders.

Revenue Per Employee

A measure of the efficiency of the business in generating revenues, which is computed as revenue divided by number of employees.