You buy a rental property for $180,000. Assuming that you could sell the property for $250,000 at the end of 6 years, what is yo
ur return based on the following cash flows? Year 0 (now) = – 180,000 End of Year 1 = + 24,000 End of Year 2 = + 24,000 End of Year 3 = – 3,000 and +12,000 End of Year 4 = + 18,000 End of Year 5 = + 30,000 End of Year 6 = + 32,000
1 answer:
Answer:
15.542%
Step-by-step explanation:
For uneven cash flows such as those in this problem, there is no formula for "internal rate of return" (IRR). It must be computed graphically or iteratively. Spreadsheets and financial calculators are equipped to do this calculation. Attached is the result of the calculation done by a graphing calculator.
The sum of "present value" of each of the cash flows is zero when the discount rate is the IRR.
You might be interested in
Answer:
There will be 2 numbers of individual bags of chocolates left with Missy.
Step-by-step explanation:
Missy bought 4 bags of chocolates and there are 8 pieces of chocolates in each bag.
Therefore, there was a total (4× 8) = 32 chocolates.
Now, her kids ate 6 of the chocolates.
So, there remains (32 - 6) = 26 chocolates left.
If Missy packed the remaining chocolates into individual bags with 13 chocolates in each bag, then there will be numbers of individual bags of chocolates left with Missy. (Answer)