Assume That an Industrial Building Can Be Purchased for $1,500,000

question 10

Multiple Choice

Assume that an industrial building can be purchased for $1,500,000 today,is expected to yield cash flows of $80,000 for each of the next five years,and can be sold at the end of the fifth year for $1,625,000.Calculate the internal rate of return (IRR) for this transaction.

• A)3.14%
• B)7.07%
• C)9.20%
• D)10.37%

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