Chasteen,Inc

question 4

Multiple Choice

Chasteen,Inc.is considering an investment with an initial cost of $185,000 that would be depreciated straight-line to a zero book value over the life of the project.The cash inflows generated by the project are estimated at $76,000 for the first two years and $30,000 for the following two years.What is the internal rate of return?

• A)6.44 percent
• B)6.94 percent
• C)7.43 percent
• D)7.55 percent
• E)8.11 percent

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Definitions:

ADH

Antidiuretic Hormone, also known as vasopressin, a hormone that regulates water balance in the body by increasing water reabsorption in the kidneys.

Oxytocin

A hormone and neurotransmitter involved in childbirth and lactation, also associated with empathy, trust, sexual activity, and relationship-building.

Anterior Pituitary

The front part of the pituitary gland, which secretes hormones regulating various physiological processes, including growth and reproduction.

Follicle-Stimulating Hormone

A hormone secreted by the anterior pituitary gland that stimulates the growth of follicles in the ovaries and spermatogenesis in the testes.