Better Mousetraps has developed a new trap. It can go into production for an initial investment in equipment of $6.6 million. The equipment will be depreciated straight line over 6 years to a value of zero, but in fact it can be sold after 6 years for $643,000. The firm believes that working capital at each date must be maintained at a level of 15% of next year's forecast sales. The firm estimates production costs equal to $1.90 per trap and believes that the traps can be sold for $6 each. Sales forecasts are given in the following table. The project will come to an end in 6 years, when the trap becomes technologically obsolete. The firm's tax bracket is 35%, and the required rate of return on the project is 12%. Use theMACRS depreciation schedule.

Year: Sales (millions of traps)

0 0

1 .40

2 .50

3 .70

4 .70

5 .50

6 .30

Thereafter

a.What is project NPV?(Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Enter your answer in millions rounded to 4 decimal places.)

b.By how much would NPV increase if the firm depreciated its investment using the 5-year MACRS schedule?(Do not round intermediate calculations. Enter your answer in whole dollars not in millions.)