Problem 12-17 Net Present Value Analysis; Internal Rate of Return; Simple Rate of Return (LO12-2, LO12- 3, LO12-6] Casey Nelson is a divisional manager for Pigeon Company. His annual pay raises are largely determined by his division's return on investment (ROI), which has been above 20% each of the last three years. Casey is considering a capital budgeting project that would require a $3,500,000 investment in equipment with a useful life of five years and no salvage value. Pigeon Company's discount rate is 16%. The project would provide net operating income each year for five years as follows: $ 3,400,000 1,600,000 1,800,000 Sales Variable expenses Contribution margin Fixed expenses: Advertising, salaries, and other fixed out-of-pocket costs Depreciation Total fixed expenses Net operating income $ 700,000 700,000 1,400,000 400,000 $ Click here to view Exhibit 12B-1 and Exhibit 12B-2, to determine the appropriate discount factor(s) using tables. Required: 1. What is the project's net present value? 2. What is the project's internal rate of return? 3. What is the project's simple rate of return? 4-a. Would the company want Casey to pursue this investment opportunity? 4-b. Would Casey be inclined to pursue this investment opportunity? Reg 1 Req 2 Req 3 Req3 Regan Req 4B What is the project's net present value? (Round your final answer to the nearest whole dollar amount.) Net present value Reg 1 Req 2 Req3 Req 3 Req 4A Req 4A Req 4B Req 4B What is the project's internal rate of return? (Round your answer to whole decimal place i.e. 0.123 should be considered as 12%.) Internal rate of return Real Req 1 Rea Reg 2 Rea Reg 3 Reqan Req 4A ReqAB Reg 4B What is the project's simple rate of return? (Round your answer to 1 decimal place i.e. 0.123 should be considered as 12.3%.) Simple rate of return %