(NPV,

PI, and IRR

calculations)

Fijisawa Inc. is considering a major expansion of its product line and has estimated the following cash flows associated with such an expansion. The initial outlay would be

$2 comma 000 comma 0002,000,000,

and the project would generate incremental free cash flows of

$600 comma 000600,000

per year for

77

years. The appropriate required rate of return is

66

percent.a. Calculate the

NPV.

b. Calculate the

PI.

c. Calculate the

IRR.

d. Should this project be accepted?