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A) You have the following information on a project's cash flows. The project's required rate is 12.5%. Year Cash flows 0 -$83,000 1 24,000 2

A) You have the following information on a project's cash flows. The project's required rate is 12.5%.

Year

Cash flows

0

-$83,000

1

24,000

2

28,000

3

36,000

4

81,000

The project's profitablity index is ____ . Round it to two decimal places.

B) A firm evaluates all of its projects by applying the IRR rule. The cash flows for a project is shown below and the firm requires 15% return on this type of project. First, compute the IRR of the project in box 1. (Do not include the percent sign (%). Round your answer to 2 decimal places. (e.g., 32.16)) Then, make the investment decision based on the IRR by inputing either "accept" or "reject" in box 2.

Year Cash Flow 0 $36,500 1 21,000 2 17,000 3 7,000

Please answer both parts if you are able to. I truly appreciate it because I really need the help. Thanks!

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