Compute the MIRR Statistic for Project I and Note Whether

question 17

Multiple Choice

Compute the MIRR statistic for Project I and note whether to accept or reject the project with the cash flows shown as follows if the appropriate cost of capital is 15 percent.Project I $$\begin{array} { | r | l | l | l | l | l | l | } \hline \text { Time } & 0 & 1 & 2 & 3 & 4 & 5 \\\hline \text { Cash Flow } & - \$ 1,000 & \$ 400 & \$ 300 & \$ 200 & \$ 300 & \$ 50 \\\hline\end{array}$$

• A)The project's MIRR is 10.29 percent and the project should be rejected.
• B)The project's MIRR is 12.67 percent and the project should be rejected.
• C)The project's MIRR is 17.17 percent and the project should be accepted.
• D)The project's MIRR is 18.19 percent and the project should be accepteD. \[\begin{array} { | l | l | l | l | l | l | l | }
• \hline \text { Year } & 0 & 1 & 2 & 3 & 4 & 5 \\
• \hline \text { Cash Flow } & - \$ 1,000 & \$ 400 & \$ 300 & \$ 200 & \$ 300 & \$ 50 \\
• \hline \begin{array} { l }
• \text { Future } \\
• \text { Value (If } \\
• \text { Positive) }
• \end{array} & & 699.60 & 456.26 & 264.50 & 345.00 & \$ 50 \\
• \hline \text { Sum of FV } & & & & & & \$ 1,815.36 \\
• \hline \begin{array} { l }
• \text { Modified } \\
• \text { CFs }
• \end{array} & - \$ 1,000 & & & & & \$ 1,815.36 \\
• \hline
• \end{array}\]

---

Definitions:

Nonresidents

Individuals or entities that do not reside within a particular jurisdiction, often affecting their taxation and legal rights.

Discriminating

Showing prejudice or bias, particularly in treatment of individuals or groups based on their characteristics.

Right to Privacy

The legal principle that one's personal information is protected from public scrutiny and the right to be left alone.

Constitution

The fundamental principles or established precedents according to which a state or other organization is governed.