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Question 5.T-Y-S.E: The cash flow diagram below has an internal rate of return o...

The cash flow diagram below has an internal rate of return of 35 \%. What is the value of Y if perpetual service is assumed? (5.3)

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\begin{aligned} & \$ 1,000,000+\$ 500,000(P / F, 35 \%, 1)-\$ 500,000(P / F, 35 \%, 2)=\frac{\$ Y}{0.35}(P / F, 35 \%, 2) \\& \$ 1,000,000+\$ 500,000(0.7407)-\$ 500,000(0.5487)=\frac{0.5487 Y}{0.35} \\& \$ 1,096,000=1.5677 Y \\ & Y=\$ 699,113\end{aligned}

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