The document describes a project with an internal rate of return of 13% and an opportunity cost of capital of 10%. The net present value of the project is positive since the internal rate of return exceeds the opportunity cost of capital. The project should be accepted since it generates a positive net present value.

1. You have the chance to participate in a project that produces the following cash flows:
a. The internal rate of return is 13%. If the opportunity cost of capital is 10%, what is the NPV of
the project?
b. Would you accept the offer?
Cash Flows ($)
C 0 C 1 C 2
5,000 4,000 11,000