Modified internal rate of return

Question

Project X costs $1,000, and its cash flows are the same in Years 1 through 10. Its IRR is 18%, and its WACC is 12%. What is the project's MIRR? Round your answer to two decimal places

Answer 1

MIRR = [(($1,000 * 0.12) / $1,000)^(1/10)] * [(1 + 0.097) / (1 + 0.12)] - 1 MIRR = 0.1201 or 12.01%