DEF Corporation is contemplating an investment in a new project. The initial investment required is CAD 250,000. The project has a life span of 7 years with no salvage value. The method of depreciation is straight-line. Cost of capital is 9%. Projected cash flows and profits are:

Year	Cash Flow	Profit
1	$30,000	$3,000
2	$35,000	$6,000
3	$40,000	$9,000
4	$45,000	$12,000
5	$50,000	$15,000
6	$55,000	$18,000
7	$60,000	$21,000

Requirements: a) Identify and explain the relevant costs in investment decisions. b) Contrast the payback period method with the net present value method. c) Compute the following using the data provided: i) The payback period. ii) The NPV of the project. iii) Determine whether DEF Corporation should proceed with the investment.