An expansion project being considered by your firm has an


An expansion project being considered by your firm has an initial cost of $1,250,000 and expected net cash flows of $270,000 per year for the first 3 years, and $380,000 per year for the next three years. Assume that the project will be terminated at the end of the sixth year. Your firm’s cost of capital is 11%. Calculate the Net Present Value (NPV), the Modified Internal Rate of Return (MIRR), the Profitability Index and the Discounted Payback for this project.

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Financial Management: An expansion project being considered by your firm has an
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