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Anderson International Limited is evaluating a project in Erewhon. The project will create the following cash flows: All cash flows will occur in Erewhon and

Anderson International Limited is evaluating a project in Erewhon. The project will create the following cash
flows:
All cash flows will occur in Erewhon and are expressed in dollars. In an attempt to improve its economy, the
Erewhonian government has declared that all cash flows created by a foreign company are "blocked" and
must be reinvested with the government for one year. The reinvestment rate for these funds is 6 percent.
Assume Anderson uses a required return of 12 percent on this project.
a. What is the NPV of the project?
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations
and round your answer to 2 decimal places, e.g.,32.16.
b. What is the IRR of the project?
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal
places, e.g.,32.16.
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