A Mining Company Plans to Mine a Beach for Rutile

question 59

Multiple Choice

A mining company plans to mine a beach for rutile.To do so will cost $10 million up front and then produce cash flows of $3 million per year for five years.At the end of the sixth year the company will incur shut-down and clean-up costs of $2 million.If the cost of capital is 11%,then what is the MIRR for this project?

• A)8.52%
• B)10.92%
• C)11.03%
• D)12.5%

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Definitions:

Economic Shift

A significant change in the structure or performance of an economy, often leading to new patterns in employment, investment, and consumer behavior.

Gross Domestic Product

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