AN EXAMPLE: THE MAJESTIC MULCH AND COMPOST COMPANY (MMCC) At this point, we want to go through a somewhat more involved capital budgeting analysis. Keep in mind as you read that the basic approach here is exactly the same as that in the shark attractant example used earlier. We have just added some real-world detail (and a lot more numbers). MMCC is investigating the feasibility of a new line of power mulching tools aimed at the growing number of home composters. Based on exploratory conversations with buyers for large garden shops, MMCC projects unit sales as follows: Year 1 2 869 SA WN 3 4 7 Unit Sales 3,000 5,000 6,000 6,500 6,000 5,000 4,000 3,000 The new power mulcher will sell for $120 per unit to start. When the competition catches up after three years, however, MMCC anticipates that the price will drop to $110. The power mulcher project will require $20,000 in net working capital at the start. Sub- sequently, total net working capital at the end of each year will be abt 15 percent of sales for that ye