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Emperor s Clothes Fashions can invest $ 5 . 1 2 million in a new plant for producing invisible makeup. The plant has an expected

Emperors Clothes Fashions can invest $5.12 million in a new plant for producing invisible makeup. The plant has an expected life of five years, and expected sales are 6.12 million jars of makeup a year. Fixed costs are $2.30 million a year, and variable costs are $1.30 per jar. The product will be priced at $2.30 per jar. The plant will be depreciated straight-line over five years to a salvage value of zero. The opportunity cost of capital is 10%, and the tax rate is 40%.
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