A small firm anticipates undertasking a small project and then shutting it down after $5$ years. Projected cash flows are below.

This is a $"$go $/$ no go decision.

Required rate of return is $12\%$

Payback is not a consideration.

Write a short report answering these questions;

What are the decision criteria?

What is the recommendation and why?

yrs

Annual CF

$0$

$($$$27,500)$

$1$

$ $10,430$

$2$

$ $43,860$

$3$

$ $11,270$

$4$

$ $9,830$

$5$

$ $(4,050)$