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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Definitions:

Contraprepared

A concept related to learning and behavioral psychology, suggesting certain behaviors or responses are more difficult to learn due to evolutionary predispositions.

Seligman

Refers to Martin Seligman, a prominent psychologist known for his work on the theory of learned helplessness and positive psychology.

Behavior

The observable actions or responses of an organism, often in response to environmental stimuli.

Sign Stimuli

Specific features or cues in an organism's environment that trigger a fixed action pattern or innate response.