Question 3

Puan Jasmin is considering a project that requires an initial investment of RM 120,000 and this is a 5-year project. This project is expected to have an after-tax cash flow of RM 20,000 per year for the first two years, RM 40,000 per year for the next two years, and RM 50,000 for the fifth year.

1. What is the Payback Period for the project?
2. Determine the Net Present Value for the project using a discount rate of 10%
3. Compute the Internal Rate of Return of the project
4. Give your recommendation to Puan Jasmin, whether to accept or reject this project if the policy of her company is to accept project within 6 years of payback period and the required rate of return is 10%. Explain your answer based on earlier calculation in part (a) to (c)

** Hi there, i appreciate if you can explain in Microsoft Word/Excel Sheet for Question 3 for my better understanding. as hand written might not be clear. thanks alot! **