Chapter 5 Valuation and the Use of Free Cash Flows

or use cash-flow portion of your calculator: ┐ FLOW 0 = 200,000 │ FLOW 1 = 110,000 │ FLOW 2 = 150,000 │ NPV = $250,727. FLOW 3 = 120,000 │ FLOW 4 = 200,000 │ i = 10 │ ┘ (b) Use the cash-flow portion of your calculator. Enter the cash flows as above, then solve for: IRR = 55.10% (c) Accept NPV > 0. IRR > cost of capital ................
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