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Paul has an opportunity to undertake a three-year project, t…

Paul has an opportunity to undertake a three-year project, that is expected to require investment of $50,000 in the first year, and $5,000 in the two subsequent years, with revenue of $30,000 in the second and third years. He wants to use cash flow analysis to determine Net Present Value (NPV) of this project. His organization is using a discount rate is 11% per annum – and the approximate Discount Factors are as given in the table.Paul wants to use $1000 as one unit for computations – for example, $50,000 would look like an investment of 50 in the table.Help Paul fill in the table below, and interpret the numbers. Discount rate 0.11         Discount factors are approximate (for a discount rate of 0.11)           Project 1     Year       0 1 2 3 Total Benefits (income) x0 x1 x2 x3 x4 Costs (investment) x5 x6 x7 x8 x9 Cashflow y0 y1 y2 y3               Discount factor 1 0.9 0.8 0.7   Discounted benefits z0 z1 z2 z3 z4 Discounted costs z5 z6 z7 z8 z9             Discounted benefits – discounted costs (profits in PV) n0 n1 n2 n3 n4 Cumulative benefits – cumulative costs (cum. profit in PV) n5 n6 n7 n8   x0 =  _______ x1 =  _______ x2 =  _______ x3 =  _______ x4 =  _______ x5 =  _______ x6 =  _______ x7 =  _______ x8 =  _______ x9 =  _______ y0 =  _______ y1 =  _______ y2 =  _______ y3 =  _______ z0 =  _______ z1 =  _______ z2 =  _______ z3 =  _______ z4 =  _______ z5 =  _______ z6 =  _______ z7 =  _______ z8 =  _______ z9 =  _______ n0 =  _______ n1 =  _______ n2 =  _______ n3 =  _______ n4 =  _______ n5 =  _______ n6 =  _______ n7 =  _______ n8 =  _______ Based on the NPV, if you were Paul, would you recommend undertaking this project (yes/no)? _______ Why/why not? _______