You are considering opening a new plant. The plant will cost $ $104\mathrm{.}8$ million up front and will take one year to build. After that it is expected to produce profits of $ $30\mathrm{.}4$ million at the end of every year of production. The cash flows are expected to last forever. Calculate the NPV of this investment opportunity if your cost of capital is $7\mathrm{.}1\%.$ Should you make the$$ investment?

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