PROBLEM 13-17 Net Present Value LO13-3, LO13-6 Rate of Analysis; Internal Rate of Return: Simple Rate of Return LO13-2, ey Nelson is a divisional manager for Pigeon Company. His annual pay raises are largely Coni division's retu last three years. Casey is considering a capital budgeting projolvage value. P investment in equipment with a useful life of five years an discount rate is 16%. The project would provide net opera on investment (ROI), which has been above 20% each no salvage value. Pigeon Company's income each year for five years as follows: $3,400,000 1,600,000 1,800,000 Sales Fixed expenses: Advertising, salaries, and other fixed $700,000 700,000 Total fixed expenses Net operating income 1,400,000 . . .. 400,000 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. W ould the company want Casey to pursue this invest inclined to pursue this investment opportunity? Explain