• problem 2 is missing the tax rate (40%) and the project has a life of 10 years

2. Jasper Metals is considering installing a new molding machine. Sales are expected to increase by $70,000. Expenses are 25% of sales. At the beginning of the project, inventory will decrease by $19,200, accounts receivables will increase by $22,600, and accounts payable will increase by $16,200. At the end of the project, net working capital will return to the level it was prior to undertaking the new project. The initial cost of the molding machine is $261,000. The equipment will be depreciated straight-line to a zero book value over the life of the project. The equipment can be sold at the end of the project for $56,000. What is the NPV of this project given a required return of 10.4 percent? life of the project is 10 years