Axillar Beauty Products Corporation

4. (10 points) (dgnore dering new fl lf problem.) Axillar Beauty Products the production of a new conditioning shampoo whi gnore income taxes in this is) ( po the purchase of new mixing machinery. The machinery will cost salIs expected to have a useful life of 10 years, and is expected to have a will require 2 alue of $35,000 at the end of 10 years. The machinery will also need a overhaul at the end of year 6. A $40,000 increase in working capital will eded for this investment project. The working capital will be released at the end of the 10 years. The new shampoo is expected to generate net cash inflows of 0,000 per year for each of the 10 years. Axillar's discount rate is 14%. h ease in b rease in working capi n Required: a. What is the net present value of this investment opportunity? b. Based on your answer to (a) above, should Axillar go ahead with the new conditioning shampoo