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MIRR

This topic has 1 reply, 2 voices, and was last updated 1 year ago by John Moffat.

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December 22, 2021 at 10:08 am #644677
lusan
Participant
- Topics: 31
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Suppose we are not given cost of capital in the question and we need to calculate cost of capital with the help of IRR (we got 14% IRR), and question tells us to re-invest at IRR as IRR we found is the cost of capital as we are not given in the question. PV of the return phase is 2258 & PV of the investment phase is 2000, duration of project is 5 years.
when calculated MIRR using the above formula MIRR is greater than IRR.
please comment.
December 22, 2021 at 7:26 pm #644708
John Moffat
Keymaster
- Topics: 56
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Why are you assuming that the cost of capital is 14%? There is no reason at all why that should be the case.
Tell me where to find the question you are referring to.
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