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YZA Co. is evaluating a project that requires an initial investment of $200,000. The project is expected to produce the following cash flows: Year Cash

YZA Co. is evaluating a project that requires an initial investment of $200,000. The project is expected to produce the following cash flows:

Year

Cash Flow

1

$50,000

2

$55,000

3

$60,000

4

$65,000

5

$70,000

Requirements:

  1. Calculate the payback period.
  2. Calculate the NPV with a discount rate of 10%.
  3. Calculate the IRR.
  4. Determine the profitability index.
  5. Evaluate if YZA Co. should proceed with the project.

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