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DEl's tax rate is 2 5 percent. The project requires $ 8 5 0 , 0 0 0 in initial net working capital investment to

DEl's tax rate is 25 percent. The project requires $850,000 in initial net working capital investment to get operational.
a. Calculate the project's Time 0 cash flow, taking into account all side effects. Assume that any NWC raised does not require
floatation costs.
Note: A negative answer should be indicated by a minus sign. Do not round intermediate calculations and enter your answer in
dollars, not millions of dollars, e.g.,1,234,567.
b. The new RDS project is somewhat riskier than a typical project for DEI, primarily because the plant is being located overseas.
Management has told you to use an adjustment factor of +2 percent to account for this increased riskiness. Calculate the
appropriate discount rate to use when evaluating DEl's project.
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g.,32.16.
c. The manufacturing plant has an eight-year tax life, and DEI uses straight-line depreciation. At the end of the project (i.e., the end of
Year 5), the plant can be scrapped for $1.55 million. What is the aftertax salvage value of this manufacturing plant?
Note: Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g.,1,234,567.
d. The company will incur $2,350,000 in annual fixed costs. The plan is to manufacture 13,500 RDSs per year and sell them at $10,900
per machine; the variable production costs are $10,100 per RDS. What is the annual operating cash flow, OCF, from this project?
Note: Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, e.g.,1,234,567.
e. Calculate the project's net present value.
Note: Do not round intermediate calculations and enter your answer in dollars, not millions of dollars, rounded to 2 decimal
places, e.g.,1,234,567.89
f. Calculate the project's internal rate of return.
Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g.,32.16.
Answer is not complete.
I specifically need help for the Discount Rate and NPV, thank you!
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