Summary: Capital Budgeting Technique

the following table.

Year

$1$

$2$

$3$

$4$

$5$

$6$

$7$

$8$

$9$

$10$

Cash inflows

$$600,000$

$1,000,000$

$1,000,000$

$2,000,000$

$3,000,000$

$3,500,000$

$4,000,000$

$6,000,000$

$8,000,000$

$12,000,000$

The firm's current cost of capital is $13\%.$

To Do

Create a spreadsheet to answer the following questions.

a$.$ Calculate the project's net present value $($NPV$).$ Is the project acceptable under the NPV technique? Explain.

b$.$ Calculate the project's internal rate of return $($IRR$).$ Is the project acceptable under the IRR technique? Explain.

c$.$ In this case, did the two methods produce the same results? Generally, is there a