Merrill Corp. has the following information available about a potential capital investment: $1,200,000 $ 120,000 8 years Initial investment Annual net income T Expected life Salvage value Merrill's cost of capital 130,000 10% Assume straight line depreciation method is used. Gi о Required: 1. Calculate the project's net present value. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Do not round intermediate calculations. Round the final answer to nearest whole dollar.) Net Present Value TAT RR) is m or less than 10 percent. 2. Without making any calculations, determine whether the internal rate of return Greater than 10 Percent Less than 10 Percent 3. Calculate the net present value using a 13 percent discount rate. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1.) (Use appropriate factor(s) from the tables provided. Do not round intermediate calculations. Round the final answer to nearest whole dollar.) Net Present Value

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