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Caspian Sea Drinks is considering the production of a diet drink. The expansion of the plant and the purchase of the equipment necessary to produce

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Caspian Sea Drinks is considering the production of a diet drink. The expansion of the plant and the purchase of the equipment necessary to produce the diet drink will cost $26.00 million. The plant and equipment will be depreciated over 10 years to a book value of $1.00 million, and sold for that amount in year 10 . Net working capital will increase by $1.19 million at the beginning of the project and will be recovered at the end. The new diet drink will produce revenues of $9.06 million per year and cost $2.13 million per year over the 10-year life of the project. Marketing estimates 15.00% of the buyers of the diet drink will be people who will switch from the regular drink. The marginal tax rate is 35.00%. The WACC is 10.00%. Find the NPV (net present value). Answer format: Currency: Round to: 2 decimal places. Gaspian Sea Drinks is considering the production of a diet drink. The expansion of the plant and the purchase of the equipment necessary to produce the diet drink will cost $26.00 million. The plant and equipment will be depreciated over 10 years to a book value of $2.00 million, and sold for that amount in year 10 . Net working capital will increase by $1.46 million at the beginning of the project and will be recovered at the end. The new diet drink will produce revenues of \$8.82 million per year and cost $2.12 million per year over the 10-year life of the project. Marketing estimates 10.00% of the buyers of the diet drink will be people who will switch from the regular drink. The marginal tax rate is 28.00\%. The WACC is 15.00%. Find the IRR (internal rate of return). Answer format: Percentage Round to: 4 decimal places (Example: 9.2434%, \% sign required. Will accept decimal format rounded to 6 decimal places (ex 0.092434))

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