QUESTION #1

NPVCalculate the net present value (NPV) for a 15-year project with an initial investment of $50,000 and a cash inflow of $8,000 per year. Assume that the firm has an opportunity cost of 15%. Comment on the acceptability of the project. The project's net present value is $. enter your response here. (Round to the nearest cent.)

QUESTION #2

NPV and IRRBenson Designs has prepared the following estimates for a long-term project it is considering. The initial investment is $34,820, and the project is expected to yield after-tax cash inflows of $4,000 per year for 14 years. The firm has a cost of capital of 12%.

a.Determine the net present value (NPV) for the project.

b.Determine the internal rate of return (IRR) for the project.

c.Would you recommend that the firm accept or reject the project?