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Question(s) / Instruction(s):

Sushi, Inc. needs to purchase a new machine costing $2.08 million. Management is estimating the machine will generate cash inflows of $396,000 for two years and $300,000 for the following seven years. If management requires a minimum 8 percent rate of return, should the firm purchase this particular machine? Why or why not?                                                         

A.            yes; because the IRR is 10.38 percent

B.            no; because the IRR is 7.57 percent

C.            no; because the IRR is .68 percent

D.            yes; because the IRR is 8.47 percent

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