Johan is considering purchasing new equipment for his business, but he is unsure if it's the best use of company funds at this point in time. With the new $200,000 equipment, Johan will be able to take on a new order that will pay $30,000, $50,000, $70,000, and $80,000 in revenue. Calculate Johan's minimum rate (IRR).

Answer rating: 100% (QA)

To calculate Johans minimum rate of return or internal rate of return IRR we need to determine whether the investment in new equipment is worthwhile based on the future cash flows it will generate Wel... View the full answer