Lancaster Medical centre is studying a project that would have an eight-year life and require a $1,600,000

invest in equipment. At the end of eight years, the project would terminate and the equipment

would have no salvage value. The project would provide net cash-in each year $500,000

The interest rate is 18%.

Required:

1. Compute the present value of net annual cash inflow from the project

2. Is the project acceptable?