You Are Considering an Investment for Which You Require a 14

question 106

Multiple Choice

You are considering an investment for which you require a 14 percent rate of return. The investment costs $58,900 and will produce cash inflows of $25,000 for 3 years. Should you accept this project based on its internal rate of return? Why or why not?

• A) Yes; because the IRR is 13.13 percent
• B) Yes; because the IRR is 13.65 percent
• C) Yes; because the IRR is 13.67 percent
• D) No; because the IRR is 13.13 percent
• E) No; because the IRR is 13.65 percent

---

Definitions:

Seismic Records

data captured by seismographs, which document the waves generated by earthquakes, explosions, or other ground-shaking phenomena.

Surface Waves

Seismic waves that travel along the earth's surface, causing the ground to shake in an elliptical motion, often responsible for the damage during earthquakes.

Ground Shaking

Vibrations of the earth's surface typically caused by seismic waves generated during earthquakes.

Tsunami

A large sea wave caused by underwater earthquakes or landslides.