All a part of the question:

1A. Cleveland Cliffs is considering purchasing the ore ship "Buckalo". The initial outlay is $12,000,000. The ship will generate $3,500,000 per year in net cash in-flows. Cliffs plans to sell/scrap the vessel after five years for $1,000,000. If the firm uses a required rate of return of 15% on similar projects, calculate the "buckalo" projects NPV.

a. 229,720

b. 758,321

c. 1,350,375

d. 2,229,270

1B. What is the Buckalo's IRR?

a. 23.76%

b. 20.75%

c. 17.05%

d. 15.78%

1C. What is the Buckalo's Payback Period?

a. 3.43

b. 4.25

c. 4.78

d. 5.15

1D. If a project's IRR is more than the investors required rate of return, than

a. NPV is positive

b. NPV is zero

c. NPV is negative

d. none of the above