Pet World Is Considering a Project That Has the Following

question 38

Multiple Choice

Pet World is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's IRR can be less than the cost of capital (and even negative) , in which case it will be rejected.
$\begin{array}{cccccc}\text { Year } &0 & 1 & 2 & 3 & 4 & 5 \\\hline-\text { Cash flows } &\$ 9.500 & \$ 2.000 & \$ 2.025 & \$ 2.050 & \$ 2.075 & \$ 2.100\end{array}$

• A) 2.08%
• B) 2.31%
• C) 2.57%
• D) 2.82%
• E) 3.10%

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