Company XYZ will invest in a 3-year project that will result in sales of 4,000 items in year 1, at a selling price of $12 each, and a cost of $8.40 each. The number of items sold is estimated to grow by 10% per year. The per unit selling price and cost will remain unchanged over the three years. The tax rate is 35%. A machine for the project will cost $40,000. The present value of the CCA tax shield on the machine is $6,084. The production of this new product line will result in additional working capital balances at the end of each year as follows: - Year 0:Zero balance - Year 1:\$2,160 - Year 2: \$2,333 - Year 3:Zero balance The NPV of this project at a discount rate of 10% is: $5.449 $4.324 $1,760 $8.743