PQR Co. is considering a machinery upgrade with:

• Initial cost: $500,000
• Net annual cash inflows:
  • Year 1: $100,000
  • Year 2: $105,000
  • Year 3: $110,000
  • Year 4: $115,000
  • Year 5: $120,000

Requirements:

1. Determine the NPV at an 8% discount rate.
2. Calculate the payback period.
3. Find the IRR.
4. Assess the ARR.