A28. (Capital budgetingNPV and IRR) The Falkenhayn Company is considering an investment. The investment will cost $9,805. The projected net cash flows are

Year 1 $1,000 Year 2 $1,500 Year 3 $1,300 Year 4 $8,000 Year 5 $1,000

There will be no cash flows after Year 5.

A. Compute the NPV of the project at a discount rate of 7%. B. Compute the IRR of the project. C. Assume the company has a hurdle rate of 9%. Should it do this project?