1 12 10 9 .8 4. 7 5 3 Sign in is not complete x VA Welcome to VA Insider - VA INST X Lu Homework Discount Cash-Flow x Question 9 - Homework: Discour X + + + C ) ezto.mheducation.com/ext/map/index.html?_con=con&external_browser=0&launchUrl=https%253A%252F%252Fims.mheducation.com%252Fmghmiddleware%252Fmheproducts%252FimsCloseWindow.htm#/activity/question-group/kEZASsBkEPtwz/h. Homework: Discount Cash-Flow Analysis Assignment Saved Help Save & Exit Check 9 Better Mousetraps has developed a new trap. It can go into production for an initial investment in equipment of $6.3 million. The equipment will be depreciated straight line over 6 years to a value of zero, but in fact it can be sold after 6 years for $549,000, The firm believes that working capital at each date must be maintained at a level of 10% of next year's forecast sales. The firm estimates 1 production costs equal to $1.60 per trap and believes that the traps can be sold for $6 each. Sales forecasts are given in the following points table. The project will come to an end in 6 years, when the trap becomes technologically obsolete. The firm's tax bracket is 35%, and the required rate of return on the project is 10%. Use the MACRS depreciation schedule. Year: 6 Thereafter Book Sales (millions of traps) 0.6 0.8 1.0 1.0 0 .5 0.3 a. What is project NPV? (Do not round intermediate calculations. Enter your answer in millions rounded to 4 decimal places.) Print NPV 4.2400 million b. By how much would NPV increase if the firm depreciated its investment using the 5-year MACRS schedule? (Do not round intermediate calculations. Enter your answer in whole dollars not in millions.) The NPV increases by $