Problem 8-18 IRR (LO2) a Marielle Machinery Works forecasts the following cash flows on a project under consideration. It uses the internal rate of return rule to accept or reject projects. ?? -$11,400 G +$9,900 +$8,900 a. What is the project's IRR? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) IRR b. Should this project be accepted if the required return is 14%? Yes O No 10 Problem 8-27 NPV, Payback (LO1, LO4) 8.33 polnts A project that costs $2,200 to install will provide annual cash flows of $570 for the next 5 years. The firm accepts projects with payback periods of less than 4 years. a. What is this project's payback period? (Round your answer to 3 decimal places.) b. Will the project be accepted? G-1. What is project NPV if the discount rate is 3%? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.) c-2. Should this project be pursued? d-1. What is project NPV if the discount rate is 10%? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.) d-2. Should this project be pursued? e. Will the firm's decision change as the discount rate changes? X Answer is complete but not entirely correct. a. 3.860 Years 4/ b. Payback period Will the project be accepted? NPV of the project if the discount rate is 3% Yes C- 1. $ 410.43 Should this project be pursued? Yes 2. d- 1. d- 2. NPV of the project if the discount rate is 10% $ 410.43 No Should this project be pursued? Will the firm's decision change as the discount rate changes? e. Yes
