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4. Company ABC received a contract from company XYZ, worth $460 million to build a product. XYZ will pay $50 million when the contract is

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4. Company ABC received a contract from company XYZ, worth $460 million to build a product. XYZ will pay $50 million when the contract is signed, another $360 million at the end of the first year, and the $50 million balance at the end of second year. The expected cash outflows required to produce the product are estimated to be $150 million now, $95 million the first year, and $218 million the second year. The firm's MARR is 11.1% for this project. a) Compute the values of is for this project. b) Calculate IRR. Is the project acceptable? Final answer section (a): Final answer section (b): 4. Company ABC received a contract from company XYZ, worth $460 million to build a product. XYZ will pay $50 million when the contract is signed, another $360 million at the end of the first year, and the $50 million balance at the end of second year. The expected cash outflows required to produce the product are estimated to be $150 million now, $95 million the first year, and $218 million the second year. The firm's MARR is 11.1% for this project. a) Compute the values of is for this project. b) Calculate IRR. Is the project acceptable? Final answer section (a): Final answer section (b)

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