on list

tion $1$

tion $1$

to terminate the project at the end of eight years and to sell the machines and equipment for $$593,000.$ Finally, the project requires an initial investment into net working capital equal to $10$ percent of predicted first$-$year sales. Subsequently, net working capital is $10$ percent of the predicted sales over the following year. Sales of protein bars are expected to be $$4\mathrm{.}6$ million in the first year and to stay constant for eight years. Total manufacturing costs and operating expenses $($excluding depreciation$)$ are $80$ percent of sales, and profits are taxed at $30$ percent.

a$.$ What are the free cash flows of the project?

b$.$ If the cost of capital is $15\%,$ what is the NPV of the project?

a$.$ What are the free cash flows of the project?

The FCF for year $0$ is $$-1\mathrm{.}66$ million. $($Round to three decimal places.$)$

The FCF for years $1-7$ is $$0\mathrm{.}583$ million. $($Round to three decimal places.$)$

The FCF for year $8$ is $ million. $($Round to three decimal places.$)$