1. Find the modified internal rate of return (MIRR) for the following series of future cash flows if the company is able to reinvest cash flows received from the project at an annual rate of 12.28 percent.The initial outlay is $490,800.
Year 1: $125,500
Year 2: $169,800
Year 3: $184,500
Year 4: $173,500
Year 5: $153,100
2. Find the profitability index (PI) for the following series of future cash flows, assuming the company’s cost of capital is 14.70 percent. The initial outlay is $412,602.
Year 1: $163,517
Year 2: $187,913
Year 3: $157,760
Year 4: $193,145
Year 5: $170,497