What Is the IRR of a Project That Costs $100,000

question 5

Multiple Choice

What is the IRR of a project that costs $100,000 and provides cash inflows of $17,000 annually for six years?

• A)0.57 percent
• B)2.00 percent
• C)5.69 percent
• D)56.87 percent

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Definitions:

Cash Collections

The process or total amount of cash received from customers for goods or services.

Cost of Goods Sold

This refers to the direct costs attributable to goods produced and sold by a business, including materials, labor, and overhead expenses.

Merchandise Inventories

Goods and products that a company holds for the purpose of resale to customers.

Sales Budget

An estimate of the expected sales revenue a company aims to achieve in a specific period, including both volume and value of sales.