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# Measurement Question: An investment of \$100,000 promises an after-tax cash flow of \$36,000 per year for 6 years with no residual value. Find the...

Measurement Question: An investment of \$100,000 promises an after-tax cash flow of \$36,000 per year for 6 years with no residual value.

1. Find the investment's accounting rate of return.
2. Find the investment's payback period.
3. Find the investment's net present value at a 15 percent discount rate
4. Find the investment's internal rate of return
5. Assuming the required rate of return on the investment is 15 percent, would you recommend this investment? Explain your answer using the results from your answers to questions a-d as appropriate.

(1) Accounting Rate of Return = 36% (2) Pay BAck PEriod = 2.78 Years (3) NPV = \$ 36,241.38  (4) IRR = 27.70%... View the full answer

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