A company is thinking of investing in one of two potential new products for sale. The projections are as follows: Year Revenue/cost £ (Product A) Revenue/cost £ (Product B) 0 (150,000) outlay (150,000) outlay 1 24,000 12,000 2 24,000 25,333 3 44,000 52,000 4 84,000 63,333 Calculate the IRR for Product B only using 3% and 15% to 2 d.p.
A company is thinking of investing in one of two potential new products for sale. The projections are as follows: Year Revenue/cost £ (Product A) Revenue/cost £ (Product B) 0 (150,000) outlay (150,000) outlay 1 24,000 12,000 2 24,000 25,333 3 44,000 52,000 4 84,000 63,333 Calculate the IRR for Product B only using 3% and 15% to 2 d.p.
Chapter4A: Nopat Breakeven: Revenues Needed To Cover Total Operating Costs
Section: Chapter Questions
Problem 1EP
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A company is thinking of investing in one of two potential new products for sale. The projections are as follows:
Year Revenue/cost £ (Product A) Revenue/cost £ (Product B)
0 (150,000) outlay (150,000) outlay
1 24,000 12,000
2 24,000 25,333
3 44,000 52,000
4 84,000 63,333
-
Calculate the IRR for Product B only using 3% and 15% to 2 d.p.
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