Cardinal Company is considering a fiveyear project requiring a $ investment in equipment with a useful life of five years and no salvage value. The companys discount rate is The project would provide net operating income in each of five years as follows:

Sales                                                                                                  $

Variable expenses

Contribution margin

Fixed expenses:

Advertising, salaries, and other fixed outofpocket costs   $

Depreciation

Total fixed expenses

Net operating income                                                                  $

  

What is the projects internal rate of return?

What is the projects payback period?

What is the projects simple rate of return for each of the five years?

If the companys discount rate was instead of would you expect the project\'s net present value to be higher, lower, or the same?