Bridgette and Lisa just completed the development of a better face shield for health workers. The new productis expected to produce annual revenues of $200,000.00 Bridgette and Lisa require an investment in anadvanced 3D Printer costing $200,000.00 The project has an expected life of 5 years based upon thedevelopment and dissemination of a vaccine for coronavirus. The 3D printer will have $100.00 salvage value asthe market for 3D printers will be flooded as demand plummets for face shields. In order to produce the faceshields Bridgette and Lisa must maintain a large inventory of plastic pellets. Therefore, working capital isexpected to increase by $200,000.00 However, Bridgette and Lisa will not recover any of working capital at theend of the products life cycle. Annual operating expenses are estimated at $101,000.00 The required rate ofreturn is 8%.
Calculate the Net Present Value
Prepare a schedule of projected annual cash flows