George Shaw & Co

question 84

Multiple Choice

George Shaw & Co. invested in a project that was to last for 2 years. The project has an internal rate of return of 12%. The project is expected to produce cash inflows of $70,000 in the first year and $80,000 in the second year. The project cost is:

• A) $143,760
• B) $142,510
• C) $150,000
• D) $126,270

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Definitions:

Issue Price

The price at which new securities are offered to the public by the issuer.