Question 13 (8 points) Listen (Estimated time allowance: 4 minutes) Compute IO. Costa Inc. is looking at setting up a new manufacturing plant in Miami FL. Costa had bought a piece of land 3 years ago for $1 million thinking to use it as for expansion of its warehouse, but Costa decided to lease a building nearby for those purposes. Today, the value of the land net of taxes is estimated at $2.2 million. Costa now wants to build a new manufacturing plant for a new project called Tin-Tan on this land; the plant will cost $10 million to build, and the site requires $1.7 million worth of improvements before it is suitable for construction. Launching the project will require an investment in working capital today in the amount of $1.8 million. In addition, new equipment in the amount of $4.2 million is needed for the project. The tax rate is 20%. Enter your answer in millions. For example, if you obtained $3,450,000 then enter 3.45; for 4,000,000 then enter 4.00 The initial outlay (IO) for the NPV evaluation of this project is Your Answer: Answer Previous Page Next Page MacBook Air Page 13 of 23