Quirino has an opportunity to invest in a project that will yield four annual payments of P12,000 with no salvage. The first payment will be received in exactly one year. On low-risk projects of this type, Ball requires a return of 6 percent. Based on this requirement, the project generates a profitability index of 1.03953.

1.) How much is Quirino required to invest in this project?

2.) What is the internal rate of return on Quirino's project?