Hollings Company, a furniture manufacturer, is considering investing in some new production machinery. The details of this investment are:

Amount of Investment $ 306,000

Annual cash flow revenue $ 126,000

Annual cash flow expenses $ 57,000

Life of the project (in years) 16

Scrap value of equipment at the end of the project $ 16,000

Hollings Company's corprate tax rate 21.00%

Hollings Company's weighted average cost of capital 13.00%

CCA rate on the new equipment 30.00%

Required

1) Calculate the net present value of this project.

2) Calculate the profitability index.

3) Should Hollings proceed with the new project?