Problem 12-17 (Algo) Net Present Value Analysis: Internal Rate of Return; Simple Rate of Return [LO12-2, LO12-3, L012-6) Casey Nelson is a divisional manager for Pigeon Company, Hls annual pay talses are largely determined by his division's return on Investment (ROI), which has been above 24% each of the last three years. Casey is considering a capital budgeting project that would require a $4.300.000 investment in equipment with a useful life of five years and no salvage value, Pigeon Company's discount rate is 20%. The project would provide net operating income each year for five years as follows: Sales $4,200,000 Variable expenses 1.920,000 Contribution margin 2,280,000 Fixed expenses Advertising, salaries and other fixed out of-pocket costs 3.780,000 Depreciation B60,000 Total fixed expenses 1.640.000 Het operating income Click here to view Exhibit 128-1 and Exhibit:12822. to determine the appropriate discount factors) using tables Required: 1. What is the project's net present value? 2. What is the project's internal rate of return to the nearest whole percent? 3. What is the project's simple rate of return? 4-5. Would the company want Casey to pursue this investment opportunity? 4-6. Would Casey be inclined to pursue this investment opportunity? $600,000 Complete this question by entering your answers in the tabs below