1. Fairfax Paint is evaluating a project that would cost 7,334 dollars today. The project is expected to have the following other cash flows: 2,961 dollars in 1 year, 2,655 dollars in 2 years, and 2,249 dollars in 4 years. The internal rate of return for the project is 3.27 percent and the cost of capital for the project is 6.56 percent. What is the net present value of the project?
2. Fairfax Pizza is evaluating a project that would cost 7,841 dollars today. The project is expected to have the following other cash flows: 2,501 dollars in 1 year, 2,426 dollars in 2 years, and 6,422 dollars in 4 years. The NPV of the project is -43. What is the internal rate of return for the project? Answer as a rate in decimal format so that 12.34% would be entered as .1234 and 0.98% would be entered as .0098.
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