# Question

Derive an accept/reject rule for IRR similar to equation 13-8 that would make the correct decision on cash flows that are non-normal, but that always have one large positive cash flow at time zero followed by a series of negative cash flows:

## Answer to relevant Questions

Compute the NPV for Project M and accept or reject the project with the cash flows shown as follows if the appropriate cost of capital is 8percent.Compute the payback statistic for Project A and recommend whether the firm should accept or reject the project with the cash flows shown as follows if the appropriate cost of capital is 8 percent and the maximum allowable ...Compute the PI statistic for Project Q and tell whether you would accept or reject the project with the cash flows shown as follows if the appropriate cost of capital is 12percent.Use the PI decision rule to evaluate this project; should it be accepted orrejected?Construct an NPV profile and determine EXACTLY how many nonnegative IRRs you can find for the following set of cashflows:Post your question

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