10-3: Your company management wants to invest in a project with unusual expected cash flows:

Year Cash Flow

0 $ 500,000

1 -350,000

2 450,000

3 -600,000

(A) What makes this project difficult for calculating the payback?

(B) Compute the net present value for the following discount rates: 5%; 10%; 15%; 20%.

(C) Use the above cash flows to calculate the IRR. Would using IRR for decision making be feasible? How, or how not?