Problem:
Chasteen Inc. Is considering an investment with an intitial cost of 185,000 that would be depreciated straight line to a zero book value over the life of the project. The cash inflows generated by the project are estimated at 76,000 for the first 2 years and 30,000 for the following 2 years.
Required:
Question: What is the IRR? Please Show Work.
A. 6.44%
B. 6.94%
C. 7.43%
D. 7.55%
E. 8.11%
Note: Please explain comprehensively and give step by step solution.