Jesse purchased a franchise agreement to distribute electronic gadgets for 9 years. The agreement cost $1,700,000 and she had to make investments of $850,000 for the first 2 years to set up her showroom. The franchise generated $1,000,000 in profits each year from the 1st year to 9 years afterwards. At the end of year 9, she sold the furniture in her showroom for $115,000.

a. What is the Internal Rate of Return (IRR)?

b. Should she have proceeded with this plan if her cost of capital was 18%?