New Balance is thinking of investing in a new line of sneakers shoes for the new executive.

You have been hired to evaluate the project. You find that, if the project is accepted, you

could use an abandoned warehouse already owned by New Balance with a book value of

$$500,000.$ Your superior had been planning to rent this warehouse out to another firm for

$$100,000$ a year. If your tax rate is $40\%,$ your discount rate is $15\%,$ your project lifetime is

$10$ years and you use straight line depreciation, what is the opportunity cost of this

investment?