The net present value (NPV) and internal rate of return (IRR) methods of investment and analysis are interrelated and are sometimes used together to make capital budgeting decisions.

Consider the case of Cold Goose Metal Works Inc.:

Last Tuesday, Cold Goose Metal Works Inc. lost a portion of its planning and financial data when both its maid and its backup servers crashed. The company's CFO remembers that the internal rate of return of Project Zeta is 14.6%, but he can't recall how much Cold Goose originally invested in the project nor the project's net present value. Howeber, he found a not that detailed the annual net cash flows expected to be generated by Project Zeta. They are:

Year	Cash Flow
1	$2,000,000
2	$3,750,000
3	$3,750,000
4	$3,750,000

The CFO has asked you to compute Project Zeta's initial investment using the information currently available to you. He has offered the following suggestions and observations:

A project's IRR represents the return the project would generate when its NPV is zero or the discounted value of its cash inflows equals the discouned value of its cash outflows-when the cash flows are discounted using the project's IRR.

The level risk exhibited by Project Zeta is the same as that exhibited by the company's average project, which meansthat Project Zeta's net cash flows can be discounted using Cold Goose's 10% WACC.

Given the data and hints, Project Zeta's initial investment is ____________, and its NPV is ___________. (rounded to the newarest whole dollar)

A project's IRR will _________if the project's cash inflows decrease, and everything else is unaffected.