Problem 3. First Class Fabrics (FCF) is starting a new plant in Mexico that will produce cotton fabric. FCF is deciding how much capacity to add to the plant in each of its first three years. The capacity and demand are measure in tons of cotton processed. The following table shows the annual demand that the plant will have to meet in its first three years. Year Annual Demand 20 50 75 FCF's cost of expanding capacity by x units is $.1 million dollars. FCF uses an annual discount rate of 0.5 in discounting future cash flows, i.e., the present value of a $1 cash flow that occurs a year from now is 50 cents. The firm's goal is to come up with the capacity expansion plan that minimizes the present value of the total capacity expansion cost over the next three years. How much should FCF expand capacity in each of the next three years? Problem 3. First Class Fabrics (FCF) is starting a new plant in Mexico that will produce cotton fabric. FCF is deciding how much capacity to add to the plant in each of its first three years. The capacity and demand are measure in tons of cotton processed. The following table shows the annual demand that the plant will have to meet in its first three years. Year Annual Demand 20 50 75 FCF's cost of expanding capacity by x units is $.1 million dollars. FCF uses an annual discount rate of 0.5 in discounting future cash flows, i.e., the present value of a $1 cash flow that occurs a year from now is 50 cents. The firm's goal is to come up with the capacity expansion plan that minimizes the present value of the total capacity expansion cost over the next three years. How much should FCF expand capacity in each of the next three years