Investment Data:
 Initial Cost: $7,000
 Projected Cash Inflows:

• Year 1: $1,600
• Year 2: $1,700
• Year 3: $1,800
• Year 4: $1,900
• Year 5: $2,000

Discount Rate: 11%

Requirements:

1. Compute the net present value (NPV).
2. Calculate the internal rate of return (IRR).
3. Determine the discounted payback period.
4. Evaluate the profitability index (PI).

Assess whether the project should be accepted based on NPV.