my question is Q7, internal rate of return , thank you !

PART 4 Capital Budgeting 6. Net Present Value [LO1] Concerning NPV: a. Describe how NPV is calculated, and describe the information this measuren vides about a sequence of cash flows. What is the NPV criterion decision rule? b. Why is NPV considered a superior method of evaluating the cash flows from project? Suppose the NPV for a project's cash flows is computed to be $2,500 What does this number represent with respect to the firm's shareholders? 7. Internal Rate of Return (LO5] Concerning IRR: a. Describe how the IRR is calculated, and describe the information this measure provides about a sequence of cash flows. What is the IRR criterion decision rule? b. What is the relationship between IRR and NPV? Are there any situations in which you might prefer one method over the other? Explain. c. Despite its shortcomings in some situations, why do most financial managers use IRR along with NPV when evaluating projects? Can you think of a situation in which IRR might be a more appropriate measure to use than NPV? Explain. 8. Profitability Index [LO7] Concerning the profitability index: a. Describe how the profitability index is calculated, and describe the information this measure provides about a sequence of cash flows. What is the profitability index decision rule? b. What is the relationship between the profitability index and NPV? Are there any situations in which you might prefer one method over the other? Explain. 9. Payback and Internal Rate of Return (LO2, 5] A project has perpetual cash flows of C per period, a cost of , and a required return of R. What is the relationship between the project's payback and its IRR? What implications does your answer have for long-lived projects with relatively constant cash flows? "0. International Investment Projects [LO1] In March 2014, automobile manufac- turer BMW announced plans to invest $1 billion to increase production at its South Carolina plant by 50 percent. BMW apparently felt that it would be better able to compete and create value with U.S-based facilities. Other companies such as Fuji Film and Swiss chemical company Lonza have reached i taken similar actions