4.a. Great Lakes Clinic has been asked to provide exclusive healthcare services for next year's World Exposition. Although flattered by the request, the clinic's managers want to conduct a financial analysis of the project. There will be an up-front cost of $160,000 to get the clinic in operation. Then, a net cash inflow of $1 million is expected from operations in each of the two years of the exposition. However, the clinic has to pay the organizers of the exposition a fee for the marketing value of the opportunity. This fee, which must be paid at the end of the second year, is $2 million.

Here are the cash flows from the project:

YearCash Flow0-$160,0001$1,000,0002$1,000,000 - $2,000,000 = -$1,000,000

The Year 2 cash flow is the sum of the $1 million operating inflow and the $2 million fee paid to the organizers.

One of project's IRRs is 400%.What is the other IRR?

answer as a percentage.Round to the nearest percentage point.

(Note: your financial calculator can only find one IRR.)

(Also note: there can be as many IRRs as there are sign changes in the cash flows.Here there are two sign changes.)

4.b. Continuing from the previous question, assuming a project cost of capital of 10 percent, what is the project's NPV?

4.c. Continuing from the previous questions, assuming a project cost of capital of 50 percent, what is the project's NPV?