ABC Inc. is evaluating a new project requiring an initial outlay of $900,000. The project will generate the following cash flows:

• Year 1: $160,000
• Year 2: $170,000
• Year 3: $180,000
• Year 4: $190,000
• Year 5: $200,000

Requirements:

1. Calculate the Accounting Rate of Return (ARR).
2. Determine the Payback Period.
3. Compute the Net Present Value (NPV) at a discount rate of 7%.
4. Find the Internal Rate of Return (IRR).
5. Recommend whether to proceed with the project.