Company D is considering an investment project which has the following cash flows:

Year 0: -1,200,000

Year 1: 252,000 Year 2: 340,000

Year 3: -200,000

Year 4: 580,000

Year 5: 700,000

Year 6: -200,000

Year 7: 280,000 

Year 8: 288,000

The required return rate is 12%. 

Calculate 

Modified IRR: 

The discounting approach 

The reinvestment approach 

The combination approach

Answer rating: 100% (QA)

Solution Modified IRR MIRR is the rate at which the net present value NPV of an investment becomes zero when the cash flows are discounted by a certai... View the full answer