The investment committee of Fortune Ltd is currently considering an investment in a new Project that requires an investment of $ 40,000. The company uses straight-line depreciation, and no residual value is expected from the project. The company uses a rate of return of 9.5%. Fortune Ltd usually expects a Payback of 1.5 years; and Accounting Rate of Return of 3%. The estimated income from operations and net cash flows expected from the investment is as follows:

Year	Income from operations	Net Cash Flow
1	6,000	22,000
2	9,000	25,000
3	10,000	26,000
4	8,000	24,000
5	11,000	27,000

i) Calculate the Payback Period for the Project. (3 mark)

ii) Calculate the Accounting Rate of Return for the Project. (3 mark)

iii) Calculate the Net Present Value for the Project. (6 marks)

iv) Based on your answers to (i), (ii) and (iii), should Fortune Ltd invest in this Project? Explain. (1 mark)

v) Explain why the Net Present Value is one of the better methods used in industry to evaluate investment decisions. (1 mark)

vi) Explain two key aspects that an organization must take into consideration in calculating its discount rate or the required rate of return (1 mark)