1. Consider a project with an initial investment (today, t = 0) of $620,000. This project will generate cash flows of $125,000 per year for the next 11 years, after which the remaining assets will be sold for scrap for $10,000 (at t=11). What is the net present value (NPV) of the project under a 12.0% discount rate? There are no taxes to consider. Answer with a number rounded to three decimal places.

2. Consider a project with an initial investment (today, t = 0) of $201,939.74. This project will generate cash flows of $37,500 per year for the next 6 years with no scrap value. What is the Internal Rate of Return (IRR) of the project? Answer with a number rounded to three decimal places, e.g., 4.0877% should be entered as 4.088.

3. Consider equipment for the expansion of a production line that will cost $750,000 up front (i.e., today, t = 0). The production line will be depreciated using a 3-year straight-line schedule. At the end of Year 3, the used equipment will have no value. The new line will generate earnings according to the schedule below. What is the Average Accounting Return (AAR) of the new production facility? Answer with a number rounded to three decimal places, e.g., 4.0877% should be entered as 4.088.

Year 01 Earnings = $24,500

Year 02 Earnings = $26,000

Year 03 Earnings = $27,250