An investment project requires an initial expenditure of $85,000 with a salvage (ending / terminal) value of $30,000. It is estimated the project will have annual returns of $21,000 each and every year for all 4 years. Should the company undertake this project if it wants to achieve a 9% annual rate of return? a) NPV Analysis b) Profitability Index c) Payback Analysis d) Will the IRR be higher or lower than 9%, and why? Fitzwilliam Darcy buys a bond one month before a coupon is due to be paid. The bond has a face value of $1,000 and an 8% coupon rate. There are 42 semi-annual coupons remaining. The bond is priced at a YTM of 7%. Fitzwilliam keeps the bond for fourteen years and two months. He then sells the bond. The YTM at time of sale has risen to 8.5%. While the bond was in his possession he deposited all coupons received into a bank account earning interest of J2 = 6%. a. What was the purchase price of the bond? [2] b. What was the selling price of the bond? [2] c. How much was in Fitzwilliam's bank account at the time of sale? [3] d. What was her HPRR expressed on a per annum compounded twice a year basis