Ezzell Corporation is considering a new project. It requires initial costs of $25,000 and is expected to generate annual cash inflows of $1,000, -$3,000, $6,000, $8,000, and $15,000 in the following five years. Suppose the cost of capital to finance the project will be 10%.

1. Use the NPV rule to make a decision on the acceptance of the project and justify your choice.
2. What does the IRR rule say about the project?
3. In general, discuss the advantages and disadvantages of NPV vs. IRR when they are used to select long term investment projects.