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( 1 5 Percent ) Suppose you have developed the following information for a potential investment: current market value is $ 1 , 2 0

(15 Percent) Suppose you have developed the following information for a potential investment: current market value is $1,200,000; anticipated loan to value ratio is .80 with 2 points; and predicated cash flows of ATCF1= $38,560, ATCF2=$41,780, ATCF3= $37,210, ATCF4=$39,127, and ATER4= $191,730. Further, assume the investor's minimum required after-tax rate of return on equity is 12%.
a. What is the internal rate of return on this potential investment?
b. What is the profitability index on this investment?

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