A venture requiring an immediate investment of $500,000 and an additional investment of $200,000 three years from

Question:

A venture requiring an immediate investment of $500,000 and an additional investment of $200,000 three years from now will generate annual profits of $150,000 for seven years starting in the first year. There will be no significant terminal value. Calculate the IRR of the investment. Should the investment be undertaken at a 13% cost of capital?