$P=$

$$500$

$2.$ Your Construction company has forecasted the cash flow situation of the business for the next six years $($in USD$)$ as shown in Table $2\mathrm{.}1.$

Table $2\mathrm{.}1$: Forecasted the cash flow

$\backslash$table$[[$Year$,$Initial cost,Payments,Receipts,Salvage value$],[0,60000,-,-,],[1,,11000,25000,],[2,,10000,24000,],[3,,9500,23500,],[4,,12500,26500,],[5,,10500,24500,],[6,,8500,22500,10000]]$

Tasks:

i$)$ Determine the internal rate of return IRR of the investment; $(20$ marks$)$

ii$)$ If all forecasted cash flows are expected to vary by $+-10\%,$ determine the net cas flow for the best$-$case scenario.

$(10$ marks$)$