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Question: The caffeine coffee company uses modified internal rate of return. The firm has a cost capital of 11 percent. The project being analyzed is as follows ($26,000 investment).

Year 1 12,000

Year 2 11,0000

Year 3 9,000

What is the modified internal rate of return? (use a Texas Instrument Analyst to compute the MIRR and include the steps.)

Assume the traditional rate of return on the investment is 17.5 percent. Explain why your answer in part a would be lower.

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Category:- Basic Finance
Reference No.:- M92789140

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