For Questions 20-22 use the following set of cash flows:

Initial investment = $1,550,000

Yr 1 : 160,000

Yr 2: 170,000

Yr 3: 155,000

Yr 4: 188,000

Yr 5: 190,000

Sale of property occurs at the end of Yr 5 for a price of $2,275,000

20) What is the IRR of this investment?

1. 17.57%
2. 18.11%
3. 18.60%
4. 17.09%

21) If the hurdle rate for this company is 11.50%

1. There must be a positive IRR
2. There must be negative NPV
3. The NPV is zero because the IRR is above the hurdle rate
4. There must be a positive NPV

22) The NPV of the investment is

1. $542,200
2. - $125,678
3. $394,042
4. $357,895