Problem based on good acquisition


Question:

A company wants to buy another similar company. The estimate of net cash flows for the acquired company are $800,000 per yr for 10 yrs. The cost is $5,000,000 and the company's cost of capital is 12%. Is this a good acquisition? How do I determine the NPV, IRR, and MIRR?

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Finance Basics: Problem based on good acquisition
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