Internal rate of return.
Lepton Industries has three potential projects, all with an initial cost of $1,800,000.
Given the discount rate and the future cash flows of each project, what are the IRRs of the three projects for Lepton Industries?
|
Cash Flow
|
Project Q
|
Project R
|
Project S
|
|
Year 1
|
$500,000
|
$600,000
|
$1,000,000
|
|
Year 2
|
$500,000
|
$600,000
|
$800,000
|
|
Year 3
|
$500,000
|
$600,000
|
$600,000
|
|
Year 4
|
$500,000
|
$600,000
|
$400,000
|
|
Year 5
|
$500,000
|
$600,000
|
$200,000
|
|
Discount rate
|
7%
|
11%
|
15%
|