A construction company is considering investing Rs. 1,000 lakhs in a new housing project. The project is expected to yield the following earnings (before depreciation and taxes) over the next eight years:

Year	Earnings (Rs. in lakhs)
1	250
2	260
3	270
4	280
5	290
6	300
7	310
8	320

The cost of capital is 10%, and the project will be depreciated on a straight-line basis over its life. The scrap value at the end of eight years is estimated to be Rs. 60 lakhs. Assume no income tax.

Requirements:

1. Calculate the net present value (NPV) of the project.
2. Determine the internal rate of return (IRR) of the project.
3. Compute the payback period.
4. Evaluate the profitability index of the project.
5. Advise whether the company should proceed with the project based on the NPV and IRR.