### Answers Chapter 8 Investment Decision Rules ( Most Of Them ...

IRR = 12000/10000 – 1 = 20% The cost of capital can increase by up to 10% without changing the decision. 6-2. You are considering investing in a start-up company. The founder asked you for $200,000 today and you expect to get $1,000,000 in nine years. Given the riskiness of the investment opportunity, your cost of capital is 20%.