2 Duncombe Village Golf Course is considering the purchase of new equipment that will cost $1,250,000 if purchased today. It will generate the following cash disbursements and receipts. 1) Should Duncombe pursue the investment if the interest rate for the capital is 8%? Why? (1pt) 2) What is the internal rate of return of this project? (1pt) Year 1 2 3 4 Cash Receipts 950,000 925,000 800,000 675,000 Cash Disbursements 500,000 475,000 450,000 430,000 Cash Cash Net Cash Interest Year Inflows Outflows Flow rate 0 $ 1,250,000 8% NPV NPV(rate,value1, value2,...) = 1 $ 950,000 $ 500,000 2 $925,000 $ 475,000 3 $ 800,000 $450,000 IRR= IRR (vlaues) 4 $ 675,000 $ 430,000