Your factory has been offered a contract to produce a part for a new printer. The contract would last for threeyears, and your cash flows from the contract would be $ 4.95

$4.95 million per year. Your upfront setup costs to be ready to produce the part would be $ 8.03

$8.03 million. Your discount rate for this contract is 8.3 %

8.3%.

a. What is theIRR?

b. The NPV is $ 4.66

$4.66 million, which is positive so the NPV rule says to accept the project. Does the IRR rule agree with the NPVrule?