Nichols Inc. is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's IRR can be less than the cost of capital or negative, in both cases it will be rejected.
Year0
1
2
3
4
5
Cash flows?$1,250
$325
$325
$325
$325
$325
A. 9.43%
B. 9.91%
C. 10.40%
D. 10.92%
E. 11.47%
Answer: A
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