Jogging gear is considering a project with an initial cash requirement of $238,400. the project will yield cash flows of $4,930 monthly for 65 months. what is the rate of return on this project?

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Business

Amira Zhang

11 September, 05:24

Jogging gear is considering a project with an initial cash requirement of $238,400. the project will yield cash flows of $4,930 monthly for 65 months. what is the rate of return on this project?

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Billy · Answer 1

First, we need to calculate for the total return of the project by multiplying 4,930 by 65. Doing so will give us an answer of $320,450. Then, we calculate the rate of return as shown below.

rate of return = ($320,450 / $238,400) x 100%

= 134.42%

Thus, the rate of return of the said project is approximately 134.42%.