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a . Prepare an NPV profile of the purchase. b . Identify the IRR on the graph. c . Should OpenSeas go ahead with the

a. Prepare an NPV profile of the purchase.
b. Identify the IRR on the graph.
c. Should OpenSeas go ahead with the purchase?
d. How far off could OpenSeas's cost of capital estimate be before your purchase decision would change?
a. Prepare an NPV profile of the purchase.
To plot the NPV profile, we compute the NPV of the project for various discount rates and plot the curve.
The NPV for a discount rate of 2.0% is $
The NPV for a discount rate of 11.5% is $
The NPV for a discount rate of 17.0% is $
The NPV profile is:
million. (Round to one decimal place.)
| million. (Round to one decimal place.)
] million. (Round to one decimal place.)
b. Identify the IRR on the graph.
The approximate IRR from the graph is
%.(Round your answer to one decimal place.)
c. Should OpenSeas go ahead with the purchase? (Select the best choice below.)
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