question 3: part A and B

question 4: MIRR?

3. [10 Points) A firm is considering an investment project with the following information: MBAD 6152 Initial capital expenditure $24 million Annual sales (in units) 3 million units Selling price per unit $15 Cost per unit $8 Project life 3 years Depreciation Straight line, over the life of the project Working capital Initially (Year 0) the project requires an increase in net working capital of $3 million, but it will be recovered after the project's life (Year 3). Tax rate 30% WACC 25% I (a) What are the project's free cash flows in Years 0, 1, 2, and 3? (b) What is the net present value of the project? 4. 15 Points] A project has an initial cost of $1,000, expected net cash flows of $450 per year for 3 years, and a cost of capital of 10%. What is the project's MIRR