Calculate the irr if the power company gets a fixed feed-in tariff of $0.25/kwh, for 20 years and the salvage value of the plant after 20 years is $20 m.

0.2449 or 24.49%

Step-by-step explanation:

Calculate the IRR if the power company gets a fixed feed-in tariff of $0.25/kWh.

IRR means Internal Rate of Return is given by

Where,  FV = Final value ($20)

             PV = Present value ($0.25)

               N = 20 years

Now put the values

=

= 1.24495742 - 1

= 0.24495742

Converting in percentage :

0.24495742 × 100 = 24.49%

IRR = 0.2449 or 24.49%

except a rational number. : )

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step-by-step explanation: