Suppose that you are the manager of a small company that is contemplating construction of a suburban office block. The cost of buying the land and constructing the building is $$710,000.$ Your company has cash in the bank to finance construction. You forecast a shortage of office space in the area and predict that you will be able to rent out the building for two years at $$30,500$ a year. You forecast that at the end of that time you will be able to sell the building for $$844,000.$

Thus, there are now two future cash flows$--$a cash flow of C$1=$ $$30,500$ at the end of one year and a further cash flow of C$2=($$$30,500+$ $$844,000)=$ $$874,500$ at the end of the second year.

Calculate the NPV of the office building venture at interest rates of $7,12,$ and $17\%.$

At what discount rate $($approximately$)$ would the project have zero NPV$?$