You are considering an investment for which you require a rate of return of 8.5 percent. The investment costs $67,400 and will produce cash inflows of $26,870 for three years. Should you accept this project based on its internal rate of return? Why or why not

• A. Yes; because the IRR is 6.67 percent
• B. Yes; because the IRR is 7.08 percent
• C. No; because the IRR is 7.08 percent
• D. No; because the IRR is 9.51 percent
• E. Yes; because the IRR is 9.51 percent

What is the net present value of the following cash flows if the relevant discount rate is 4.91 percent?

Year	Cash Flow
0	$11,400
1	$2,500
2	$2,500
3	$9,500

• A. $1,402.02
• B. -$1,232.68
• C. $507.19
• D. $1,211.40
• E. -$1,482.06