Question: Help with full explanation please 7. Now suppose we're looking at a project that pays free cash flow every year for 10 years; has an
7. Now suppose we're looking at a project that pays free cash flow every year for 10 years; has an initial cost of and a $10m in the final year. cost of $20m in a) Calculate the Internal Rate of Return (IRR) for this project, and comment on whether you think will create value for the company. b) Calculate the Modified IRR (MIRR) for this project using a discount rate of 10%, and comment on why we might choose to use this calculation instead of a regular IRR. Why do we perform sensitivity analysis and/or scenario analysis when we analyze projects like this? Explain how it helps us make more informed decisions
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