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Northern Distributors expects a 1 7 % rate of return on their investments. They are considering a 1 5 year project which will cost them

Northern Distributors expects a 17% rate of return on their investments. They are
considering a 15 year project which will cost them $100,000 immediately, $10,000 each
year for years 2 to 6,$20,000 each year for years 7 to 11 and $25,000 each year for the
years 12 to 15 of the project. Should they take on the project if it will return $30,000 at
the end of each year for the first 3 years, $40,000 at the end of each year in the next 4
years, and $60,000 at the end of each year for the last 8 years?
a) Prepare a fully documented timeline of all cash flows (5 marks)
b) Calculate the NPV of the project. (10 marks)
c) Calculate the ROI of the project. (5 marks)
d) Determine the payback period of the project (5 marks)
e) Would you go ahead with the project? Why/why not? (5 marks)
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