2. You are considering opening a new plant. The plant will cost $96.4 million upfront. It expected to produce profits of $28.7 million at the end of every year, starting year 1. The cash flows are expected to last forever. There are 2 million shares outstanding.
   

   
   

   Calculate the NPV of this investment opportunity if your cost of capital is 8.9%. Should you make the investment?

   Current stock price is $50. What is the impact of this project on the stock price?

   Calculate the IRR and use it to determine the maximum deviation allowable in the cost of capital estimate to leave the decision unchanged.