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Your factory has been offered a contract to produce a part for a new printer. The contract would last for three year: and your cash flows from the contract would be $4.75 million per year. Your upfront setup costs to be ready to produce the part would be $8.08 million. Your discount rate for this contract is 8.3%. a. What does the NPV rule say you should do? b. If you take the contract, what will be the change in the value of your firm? Marian Plunket owns her own business and is considering an investment. If she undertakes the investment, it will pay $4,120 at the end of each of the next three years. The opportunity requires an initial investment of $1,030 plus an additional investment at the end of the second year of $5,150. What is the NPV of this opportunity if the cost of capital is 1.8% per year? Should Marian take it? OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship will cost $504 million and will operate for 20 years. OpenSeas expects annual cash flows from operating the ship to be $70.4 million and its cost of capital is 11.7%. a. Prepare an NPV profile of the purchase. b. Identify the IRR on the graph. c. Should OpenSeas go ahead with the purchase? d. How far off could OpenSeas's cost of capital estimate be before your purchase decision would change