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PART II 15 Points PROBLEMS - CALCULATIONS For each question, enter your answers on the ANSWER SHEET. Show your work and calculations. 10) A
PART II 15 Points PROBLEMS - CALCULATIONS For each question, enter your answers on the ANSWER SHEET. Show your work and calculations. 10) A sum of $500,000 dollars invested today in an investment project is expected to generate the series of below cash inflows in future: $100,000 in year 1 $ 150,000 in year 2 $225,000 in year 3 $ 200,000 in year 4 $50,000 in year 5 a)If the Opportunity Cost of Capital is 10% per annum, what is the NPV of the project and should we accept this project? Show your calculations. 5pts b) Would your answer be the same if the discount rate was 15%? Explain showing your calculations. 5pts c) What is the IRR of the project? (Show IRR rounded to the nearest decimal). 3pts d) Considering the IRR, can the project be accepted? Explain briefly 2pts
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