A) Radha Industries is considering an expansion. The necessary equipment would be purchased for $20 million, and the expansion would require an additional $5 million investment in net operating working capital. The company spent and expensed $500,000 on research related to this project last year. How much is the initial investment outlay of this project?

		$20 million
		$25.5 million
		$20.5 million
		$25 million

B) Now suppose that Radha Industries in question 3 above, plans to use a building that it owns to house the project. The building could be sold for $1 million after taxes and real estate commissions. Should Radha Industries include this $1 million as part of the initial investment in the new project?

		Yes, because the company could sell the building if it didnt use it for the new project.
		No, because the company will still be able to sell the building once the project is complete.
		No, because the cost of the building is a sunk cost.