An expansion project being considered by your firm has an initial cost of $8,000,000

and expected net cash flows of $1,500,000 per year for the first 2 years, 1,800,000 for

the third and fourth years, and $1,900,000 per year for the fifth and sixth years. All

cash flows will occur at the end of each year. Assume that the project will be terminated

at the end of the sixth year. Your firm's cost of capital is 11%. Calculate the Net

Present Value (NPV), the Modified Internal Rate of Return (MIRR), the Discounted

Payback Period, and the Equivalent Annual Annuity for this project. Should the project

be accepted? Why or why not? Give an

interpretation

for each of the four methods and

indicate

how they are used