presumed in the example. What is the NPW in this situation?

Mary Ortiz has recently developed a highly successful business distributing high$-$fash$-$

ion ladies' handbags. She believes that she can double her $$5$ million annual sales by

developing a South American market. Since most of her production is outsourced, her

investment in physical plant and equipment is minimal at $$200,000.$ However, her cur$-$

rent working capital requirements are $$1,400,000,$ broken down as follows:

How much must she be prepared to invest before taxes to accomplish the expansion?

It's likely that physical facilities and payables would remain proportional to business

levels. The distance and delays associated with payment of international accounts could

lengthen the payment cycle by $50$ to $100\%.$ Transportation delays for international busi$-$

ness could require added inventory of $20-30\%$ over normal levels for this segment of

the business. Mary estimates the marketing and development costs at $$1,000,000.$

$10\mathrm{.}4.$

Suppose in Problem