Assume an investment has an initial cost of $300,000 and future cash flows of $121,750, $198,500, and $18,500 for years 1, 2, and year 3, respectively.

1. What is the NPV if the required return is 13 percent?

2. Should the investment be accepted or rejected?

3. Based upon your answer from question 1., would the IRR be higher or lower than the required return?