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Question: consider the following projects cash flows year endofyear cash flow...

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Consider the following project’s cash flows:

Year    End-of-year Cash Flow

  1. –$1,000
  2. -$2,000
  3. $2,000
  4. $1,500

A. What is this project’s net present value if the discount rate is 6 percent?

B. What is this project’s internal rate of return?

C. What is this project’s modified internal rate of return if the reinvestment rate is 5 percent?

D. What is this project’s modified internal rate of return if the reinvestment rate is 6 percent?

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