Abdullah & Sons Corporation is considering a major expansion of its product line and has estimated the following cash flows associated with such an expansion. The initial outlay would be $4,500,000, and the project would generate incremental free cash flows of $1,250,000 per year for 5 years. The appropriate required rate of return is 9 percent. (10 Marks)

a. Calculate the NPV and suggest that should the project be accepted?

b. Calculate the PI.

c. Calculate the IRR.

d. If Abdullah & Sons Corporation required rate of return is changed to 14 percent, then should

this project be accepted.