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You are the owner of a local beach bar and you are considering the purchase of a new alcohol distribution system to keep your bartenders from swiping all of your good stuff. The new system will cost $20,000 and will reduce working capital (investment in alcohol) by $20,000. The system will be sold to the competition for $19500(Net after tax) at the end of the five year useful life. The new equipment is expected to generate an OCF of $46,500 per year. Given this, what is the IRR of the investment?

Answer: 9.12%

How would I input the information properly yo get the IRR?

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Operation Management, Management Studies

Category:- Operation Management
Reference No.:- M9353456

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