alcon Crest Aces (FCA), Inc., is considering the purchase of a small plane to use in its wing-walking demonstrations and aerial tour business. Various information about the proposed investment follows:

Initial investment	$	280,000
Useful life	$	10	years
Salvage value		25,000
Annual net income generated	$	6,200
FCA's cost of capital		8	%

1. Accounting rate of return. (Round your answer to 2 decimal places.)

2. Payback period. (Round your answer to 2 decimal places.) (Find how many years)

3. Net present value (NPV)

4. Recalculate FCA's NPV assuming the cost of capital is 3% percent.

5.	Without doing any calculations, what is the project's IRR?

Less than 3%

Between 3% and 8%

Greater than 8%