Project Cash Flows:Initial investment: $3,500,000Year 1: $1,000,000Year 2: $1,500,000Year 3: $2,500,000Year 4: $1,000,000Requirements:Plot the NPV...

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Accounting

Project Cash Flows:

  • Initial investment: $3,500,000
  • Year 1: $1,000,000
  • Year 2: $1,500,000
  • Year 3: $2,500,000
  • Year 4: $1,000,000

Requirements:

  1. Plot the NPV profile for the project.
  2. Calculate the IRR.
  3. If the required rate of return is 10%, should the project be accepted?
  4. What is the payback period for the project?

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