5. Flash Memory, Inc. was an electronic device producer founded in San Jose, Cali- fornia. Since its founding, Flash Memory had focused on solid state drives (SSDs)! production. Back in 2010, the company received a proposal for a major new product line. $400,000 had already been spent on this product line during development taking the product from prototypes to current testings. Flash Memory believes that this project would generate sales of at least $21.6 million in 2011, $28 million in 2012 before falling off to $11 million in 2013 and exiting from the market in 20142. However, implementing this new product line would require large investments: New plant and equipment costing $2.1 million must be purchased. It would be depreciated straight-line to zero over the product's 3-year life. Depreciation expenses were included in cost of goods sold (COGS), and COGS was 75% of sales per year. Flash also expected net working capital (NWC) to be 20% of projected sales per year. To support production, investment in equipment and the first net working capital expense would occur in 2010 (not 2011). Besides these two types of costs, the firm's marketing manager also planned a one-time $300,000 advertising campaign with the launch of the product in 2011. If the estimated cost of capital for this project is at 10.05% and Flash Memory's income tax rate is at 35%, should Flash Memory go with this investment? Show your calculation process. [10 points]