Internal Rate of Return: Lowell Communications, Inc

question 38

Multiple Choice

Internal rate of return: Lowell Communications, Inc., has been installing a fiber-optic network at a cost of $18 million. The firm expects annual cash flows of $3.7 million over the next 10 years. What is this project's internal rate of return? (Round to the nearest percent.)

• A) 10%
• B) 12%
• C) 14%
• D) 16%

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Definitions:

Staff Units

Specialized groups within an organization that provide support and expertise but do not directly contribute to its main objectives.

Specialized Expertise

Specific knowledge or skills in a particular area or field that sets an individual or group apart.

Appropriate Way

The most suitable or proper method to achieve a specific goal or to handle a situation.

Output Controls

Mechanisms put in place to measure the results of operations or performance to ensure that goals and objectives are met.