Under the following assumptions, why would the MIRR and IRR forumlas provide different outcomes?
Year 0
-50,000
Year 1-5
17,500
Cost of money: 10%
MIRR= 16.4%
Year 0
-50,000
Years 1-5
12,500 (next of 10% cost of money)
IRR=7.9%
Which one is correct, which one should I use?
Ron
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