Star City is considering an investment in the community center that is expected to return the following cash flows:

Year	Net Cash Flow
1	$21,000
2	$51,000
3	$81,000
4	$81,000
5	$101,000

This schedule includes all cash inflows from the project, which will also require an immediate $201,000 cash outlay. The city is tax-exempt; therefore, taxes need not be considered. The required rate of return is 8%.

Answer the following:

Compute the NPV and the IRR of the investment.

Should the company invest in the project? Be sure to consider mission, strategy, risk, and ethical implications for all stakeholders.

Re-compute the NPV assuming the required rate of return is 18%. What is your recommendation?