(Ignore income taxes in this problem.) Acme, Inc. is considering a project that would have a ten-year life and would require a $1,275,000 investment in equipment. At the end of ten years, the project would terminate and the equipment would have no salvage value. The project would provide net operating income each year as follows:

	Sales..........................................................		$1,750,000
	Less variable expenses...............................		900,000
	Contribution margin..................................		850,000
	Less fixed expenses:
	Fixed out-of-pocket cash expenses........	$517,000
	Depreciation...........................................	119,000	636,000
	Net operating income................................		$ 214,000

All of the above items, except for depreciation, represent cash flows. The company's required rate of return is 16.5%.

A. Compute the project's net present value.

B. Compute the project's internal rate of return.

C. Compute the project's payback period.

D. Compute the project's simple rate of return.

E. Based on your analysis above, should Acme, Inc. purchase this equipment? Why or why not? You must address ALL four capital budgeting methods in this answer.