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Craigco is considering an investment that will cost $250,000 and last for five years. The investment will be amortized on a straight-line basis over that

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Craigco is considering an investment that will cost $250,000 and last for five years. The investment will be amortized on a straight-line basis over that period. Earnings generated by the investment before amortization and taxes over this period are as follows: Year 1 $65,000 Year 2 $67,000 Year 3 $71,000 Year 4 $75,000 Year 5 $80,000 1 x A. BIT a) Calculate the average Accounting Return of the Project (3 marks) b) Calculate the Payback period of this project (3 marks) c) Calculate the Net Present value of this project assuming a 10% interest rate (5 marks) d) Calculate the Pro E E 1 x B IT b) Calculate the Payback period of this project (3 marks) Calculate the Net Present value of this project assuming a 10% interest rate (5 marks) d) Calculate the Profitability Index of the project assuming a 10% interest rate (2 marks) e Calculate the Internal Rate of Return of the project (2 marks)

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