Question: You are evaluating a potential project for your firm. The project requires an up - front investment of $ 1 , 2 5 0 ,

You are evaluating a potential project for your firm. The project requires an up-front investment of $1,250,000 and will generate cash inflows of $225,000 at the end of each of the next six years. You estimate the projects risk-adjusted cost of capital at 12%. What is the projects NPV? What does the NPV decision rule says about this project. What is the projects IRR? What does the IRR rule say about this project? LO3NPV =$324,933.35, the NPV rule says to reject the project; IRR =2.24%, the IRR rule says to reject the project.NPV = $97,064.61, the NPV rule says to accept the project; There is no IRR for this project.NPV = $100,000, the NPV rule says to accept the project; IRR =6.40%, the IRR rule says to reject the project.NPV = $227,104.43, the NPV rule says to accept the project; IRR =12.57%, the IRR rule says to accept the project.

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