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Hathaway, Inc., a resort management company, is refurbishing one of its hotels at a cost of $7.8 million. Management expects that this will lead to additional cash flows of $1.8 million for the next six years. What is the IRR of this project

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Answer:

The IRR of this project is 10.2%

Explanation:

We can easily find IRR by excell

The main concept to calculate IRR is setting NPV equal to zero and solve for the discount rate = IRR

Please see excel in attachment

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