An accounting firm is considering expanding their operations into new office space so that they can hire more staff and expand their company. The new lease requires a 5-year commitment. If the firm expands its operations, profits are expected to increase by $250,000 during 2023 and then those additional profits should increase by 12% each year from 2024 to 2027. Leasehold improvements to move into the new office space will cost the firm $850,000 with an estimated useful life of 5 years. Complete the following (Ignore income taxes for parts 1-5): 1. Compute the Net Present Value (NPV) of moving into the new office space, assuming a required rate of return of 10 percent. Explain. (15 words minimum 3 points) 2. Compute the Internal Rate of Return (IRR) for the proposal. Explain. (15 words minimum 3 points) 3. Compute the Payback Period (undiscounted) of the proposal. Explain. (15 words minimum 3 points) 4. Using your answers from #1 - #3, make a recommendation as to whether you would recommend expanding into the new office space. Include both quantitative (numerical) and qualitative (non-numerical) reasons for your recommendation. (150 words minimum 5 points). 5. Assuming that the lease requires a security deposit of $500,000 that is fully refundable at the end of the 5 years. Recalculate the NPV of the project. Hint: Think of the security deposit like working capital (15 words minimum 3 points). 6. (Ignore the security deposit from #5) Assume that the company pays corporate income taxes at a rate of 20%. Recalculate the NPV of the project assuming that the leasehold improvements will be depreciated using straight-line depreciation over a 5-year useful life with no salvage value. Does this change your recommendation in #4? Explain why or why not. (50 words minimum 5 points).