Belgravia Petroleum Inc. is trying to evaluate a generation project with the following cash flows:

Year

Cashflow

$0$

$-$$$300,000,000$

$1$

$$63,000,000$

$2$

$$85,000,000$

$3$

$-$$$50,000,000$

$4$

$145,000,000$

$5$

$$175,000,000$

$6$

$-$$$50,000,000$

$7$

$$70,000,000$

$8$

$$72,000,000$

calculate the following $($the cost of capital is $12\%)$

Payback period

Discounted payback period

Net present value $($NPV$)$

IRR

based on your analysis, should the company take the project? Why?

What if the cost of capital increased to $16\%,$ please recalculate NPV and using both NPV and IRR to show why or why not you should take this project?

Plot the NPV against a range of cost of capital $(5\%$ to $20\%,$ at $1\%$ each increment$)$ by using Excel

Please comment on the IRR shortfalls for Belgravia as the CFO