Merrill Corp. has the following information available about a potential capital investment Initial investment Annual net income $ 600,000 $ 60,000 Expected life 8 years Salvage value $ 70,000 Merrill's cost of capital 7 Assume straight line depreciation method is used. Required: 1. Calculate the project's net present value. 2. Without making any calculations, determine whether the internal rate of return (IRR) is more or less than 7 percent. 3. Calculate the net present value using a 14 percent discount rate. 4. Without making any calculations, determine whether the internal rate of return (IRR) is more or less than 14 percent.