Problem 8-13 You are CEO of Rivet Networks, maker of ultra-high performance network cards for gaming computers, and you are considering whether to launch a new prouct. The product, the Killer X3000, will cost $900,000 to develop upfront (year 0), and you expect revenues the first year of $800,000, growing to S1.5 million the second year, and then declining by 40% per year for the next 3 years before the product is fully obsolete. In years 1 through 5.you will have fixed costs associated with the product of $100,000 per year, and variable costs equal to 50% of revenues. a. What are the cash flows for the project in years 0 through 51 b. Plot the NPV profile for this nvestment using discount rates from 0% to 50% in 5% increments. c. what is the project's NPV if the project's cost of capital is 10%? d. Use the NPV profile to estimate the cost of capital at which the project would become unprofitable; that is, estimate the project's IRR or calculate it using the data. Initial investment Revenues vear 1 Revenues vear 2 Revenues decline years Fixed costs vears 1-5 Variable costs S 900,000 S 800,000 $ 1,500,000 4000 S 100,000 50% 3-5 a. What are the cash flows for the project in years 0 through 51