Casey Nelson is a divisional manager for Pigeon Company. His annual pay raises are largely determined by his division's return on investment {ROI}, which has been above 24% each ofthe last three years. Casey is considering a capital budgeting project that would require a $5,950,000 investment in equipment with a useful life of ve years and no salvage value. Pigeon Company's discount rate is 20%. The project would provide net operating income each year for ve years as follows: Sales $ 5,363,366 Variable expenses 2,363,366 Contribution ma rgin 2, 943, 366 Fixed expenses: Advertising, salaries, and other fixed out-ofpocket costs $ 893,366 Depreciation 1,193,366 Total fixed expenses 2,683,366 Net operating income 5 853,366 I Click here to view Exhibit 123-1 and Exhibit 123-2, to determine the appropriate discount fEICtOl'{5:I using tables. Required: 1. What is the project's net present value? 2. What is the project's internal rate of return? 3. What is the project's simple rate of return? ia. Would the company want Casey to pursue this investment opportunity? ib. Would Casey be inclined to pursue this investment opportunity