Camrat plc requires a return on investment of at least 10 per cent per annum over the life of any proposed project with the same risk as its existing projects in order to meet the opportunity cost of its shareholders (Camrat is financed entirely by equity). The dynamic and thrusting strategic development team have been examining the possibility of entering the new market area of mosaic floor tiles. This will require an imme- diate outlay of 1m for factory purchase and tooling-up which will be followed by net (i.e. after all cash outflows, e.g. wages, variable costs, etc.) cash inflows of 0.2m in one year, and 0.3m in two years' time. Thereafter, annual net cash inflows will be 180,000. Required Given these cash flows, will this investment provide a 10 per cent return (per annum) over the life of the project? Assume for simplicity that all cash flows arise on anniversary dates and the project has the same risk level as the company's existing set of projects.