A factory is considering to renew its production line, which will cost $737947 in 2019 The factory is unable to operate while it is under constructing. This will cost the firm $440943 in contribution margin in 2019. Starting in 2020, factory will have a lower variable cost per unit by 23%. Annual fixed costs will increase for maintenance (Year 1: $100,000 , Year 2: 150,000 , Year 3: 200,000, Year 4: 250,000, Year 5 , 250,000) ,and $145555 for depreciation (still same for each years).

Without renewing its production line, the factory produces 2 million units per year. It has variance cost of $3 per unit, and fixed cost of $2.5 million. The final unit would sold for $5 per unit. After an renewing it production line, the factory would decrease price to $4.60 per unit, and they are able to produce and sell 2.3 million units annually. The factory is expected to be shut down at the end of 2023 regardless of the renewing decision. The factory would then be sold to another firm. Without an renew, the sale price for the factory would be $2 million. With an renew, the sale price for the factory would be $2.3 million.

1. Calculate the appropriate amount to include in an NPV calculation for 2019. (exclude any effects for other years.)
2. Calculate the appropriate amount to include in an NPV calculation for 2020.
3. Calculate the appropriate amount to include in an NPV calculation for 2023.(Note : we are skipping two years.)
4. Notwithstanding the answers given above, assume the annual amounts were as follows (including the two years you didn't calculate):

2021: -0.96 million ; 2022: 0.6 million ; 2023: 0.46 million ; 2024: 0.56 million ; 2025 0.68 million.

Assume the cost of capital is 0.15.

Calculate the NPV of the overhaul.

5.Using the numbers provided in the previous question, calculate the NPVI for the overhaul