I am wondering about the initial rate of return in this case, can anyone do me a favour? the case is A company is considering a new project. Currently the company have a 30% tax rate and 15% discount rate. Cost of new plant and equipment: $ 7 900 000 Shipping and installation cost: $ 100 000, unit sals are: Year1-70,000 units, Year2-120,000, Year3-140,000, Year4-80,000, Year5-60,000. Sales price per unit: $300/unit in year 1 to 4 and $260/unit in year 5 Variable cost per unit: $180/unit. Annual fixed cost: $200 000 per year. Working capital requirement: there will be an initial working capital requirement of $100 000 just to get production started. For each year, the total investment in net working capital will be equal to 10% of the dollar value of sales for that year. Thus the investment in working capital will increase during years 1 to 3, then decrease in year 4. Finally, all working capital is liquidated at the termination of the project at the end of year 5. Depreciation method: straight-line over five years assuming the plant and equipment have no salvage value after five years.