6.1 Now suppose you invest in both a factory and the research for the production of Green jetpacks. Look at the factory and research as a total investment. Calculate the net present value (NPV) before tax on the investment based on the following information:

1. The investment cost is paid in full in quarter 0, and the cost of the factory is 100000 while the cost of the research is also 100000.
2. The factory has a lifetime of 20 quarters (5 years) and the value of the factory at the end of quarter 20 is 0
3. Only green jetpacks should be produced at the factory throughout its lifetime.
4. There is no investment in research to streamline production or material consumption.
5. Suppose the quarterly demand in the market is constant and given at P = 338 - 0.018 * Q, where P is price and Q is the number of jetpacks in demand.
6. There are 5 competitors in the market (including you), and all sell the same number of jetpacks each quarter at the price of 248 each.
7. You produce as much as you sell.
8. The costs associated with the quarterly production at the factory are given at K = 178 * Q + 20000, where 178 * Q is direct labor cost and materials, and 20000 is quarterly maintenance cost when Q is the number of jetpacks produced.
9. The company has an annual discount rate of 20% on the investment. This means you need to divide it by 4 to get the quarterly rate.

Fill in the calculated NPV before tax in the field. A deviation of 5% from the facets are accepted. Recommendation: use Excel or similar tools to perform the calculation for this task. When using the Net Value function in Excel (NPV), pay particular attention to how you handle immediate cash flows.

6.2 Use Excel or similar tools, as well as the set-up and calculations you have from Problem 6.1. to calculate the internal rate of return before tax for investment project B, described in Problem 6.1. In Exercise 5.3. you will find tips on how to do this. You should also solve the task graphically to see how the net present value of the investment varies based on interest rates. Fill in the internal rate in % in the field below. It is sufficient to answer with one decimal (eg an interest rate of 0.5467231 = 54.7%). A deviation of 5% from the answer is accepted.