Nobell Company Is Evaluating an Investment of $1,000,000 Which Will

question 2

Multiple Choice

Nobell Company is evaluating an investment of $1,000,000 which will yield net cash inflows of $142,369 per year for 10 years with no residual value.What is the internal rate of return?
Present value of annuity of $1:
$$\begin{array} { | r | r | r | r | r | } \hline &{ 5 \% } & { 6 \% } &{ 7 \% } & { 8 \% } \\\hline 1 & 0.952 & 0.943 & 0.935 & 0.926 \\\hline 2 & 1.859 & 1.833 & 1.808 & 1.783 \\\hline 3 & 2.723 & 2.673 & 2.624 & 2.577 \\\hline 4 & 3.546 & 3.465 & 3.387 & 3.312 \\\hline 5 & 4.329 & 4.212 & 4.1 & 3.993 \\\hline 6 & 5.076 & 4.917 & 4.767 & 4.623 \\\hline 7 & 5.786 & 5.582 & 5.389 & 5.206 \\\hline 8 & 6.463 & 6.21 & 5.971 & 5.747 \\\hline 9 & 7.108 & 6.802 & 6.515 & 6.247 \\\hline 10 & 7.722 & 7.36 & 7.024 & 6.71 \\\hline\end{array}$$

• A) 6%
• B) 7%
• C) 9%
• D) 8%

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