If Aurora decides to expand, production at the new facility would start in 2021. STS requires a 12% return for all of its investment projects. Leasing costs Year 11	$240,000
Fixed costs Year 12	$ 75,000
Initial setup costs unrelated to new equipment	$ 40,000
Additional contribution margin per bottle	$ 3.80
Cost of new equipment required	$ 58,500
Useful life, new equipment	7 years
Salvage value at the end of useful life	$ 15,000

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