Q2. St Lawrence Bus Lines is offered a contract for busing schoolchildren that will produce an annual profit of $70,000 for 7 years. To fulfill the contract, St Lawrence Bus Lines would have to buy buses at a total cost of $433,000. At the end of the contract, the resale value of the buses will be $80,000. Should St Lawrence Bus Lines sign the contract if the cost of capital is a) 5% p.a b) 8% p.a. (6 marks) c) Find the IRR (Internal Rate of Return), correct to two decimal places. Page 2 of 11 0 N 3 6 out (433k) inf 70k 70k 70k 70k 70k 70k 70k 80k(RV) net