Detroit Edison Power (DEP) power plant has to come in compliance with the new mercury standards. One option is to install a Electrostatic precipitator[ESP] on its boiler. ESP reduces mercury emissions by capturing mercury particles in exhaust flue gases. ESP requires a capital investment of $600,000 in year zero and has a life of four years. Annual costs of operating the ESP are estimated at $100,000 per year. DEP uses a discount rate of 10% in its decisions. DEP is subject to 40% income taxes, and depreciation is charged at the rate of 25% of the initial capital investment each year. What will be the net cash cost for operating the ESP in its third year? $0 $-90,000 $40,000 120,000