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Fijisawa, Inc., is considering a major expansion of its productline and has estimated the following free cash flows associatedwith such an expansion. The initial outlay

Fijisawa, Inc., is considering a major expansion of its productline and has estimated the following free cash flows associatedwith such an expansion. The initial outlay associatedwith the expansion would be $1,950,000, and the project wouldgenerate free cash flows of $450,000 per year for six years. Theappropriate required rate of return is 9 percent. a.Calculate the net present value. b. Calculate the profitability index. c. Calculate the internal rateof return. d. Should this project be accepted?

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