CAPM, Inc. is considering a new 4-year expansion project that requires an initial fixed asset investment of $40 million. The fixed asset will be depreciated using the 5-year MACRS method (20%, 32%, 19.20%, 11.52%, 11.52%, 5.76%), after which time it can be sold for $8 million. The project requires an initial investment in net working capital of $5 million, all of which will be recovered at the end of the project. The project is estimated to generate $45 million in annual sales, with variable costs of $15 million per year. Annual fixed cost is $5 million per year. The tax rate is 21 percent.

Suppose the WACC is 7%. What is the net present value for this project? Will you accept the project?