Answer:
Part 1. NPV $346,465
Part 2. IRR is 19.8%
Part 3. 3 Years
Part 4. 13.33%
Explanation:
<u>Part 1.</u>
Year  Cash Flow   DF at 14%  Discounted Cash flow  	
  0         -2,400,000    1.00               -2,400,000  	
  1             800,000    0.8772                   701,754  	
  2            800,000    0.7695           615,574  	
  3            800,000    0.6750          539,977  	
  4            800,000    0.5921                  473,664  	
  5            800,000    0.5194                  <u> 415,495 </u>
                NPV                                 $346,465
    
<u>Part 2.</u>
Year   Cash Flow   DF at 14%  Disc.Cash flow   DF at 20%   Disc. Cash flow
  0     -2,400,000  1.0000     -2,400,000          1.0000          -2400,000
  1      800,000  0.8772        701,754             0.8333            666,667
  2      800,000  0.7695        615,574          0.6944          555,556
  3      800,000  0.6750        539,977          0.5787          462,963
  4      800,000  0.5921        473,664          0.4823          385,802
  5      800,000  0.5194       <u> 415,495 </u>         0.4019            <u> 321,502</u>
                              NPV              $346,465                                    -$7510
IRR can be calculated by using the following formula:
IRR = R at lower %age  + (R at Higher %age - R at Lower %age) * NPV at lower Percentage / (NPV at Higher %age - NPV at Lower %age)
Now by putting values, we have:
IRR = 14%   +  (20% - 14%)  *  346,465 / (346,465 +  7510)
IRR = 14%   +  5.8%  = 19.8%
<u>Part 3.</u>
Now by putting values, we have:
Payback Period = Initial Investment / Cash flow Per Period
Payback Period = $2,400,000 / $800,000  =  3 Years
<u>Part 4.</u> 
As we know that:
Simple Rate Of Return = Net operating income ÷ Initial investment
Now by putting values, we have:
Simple Rate Of Return = $320,000 / $2,400,000 = 13.33%