Question 16 25 pts Gracen Inc is evaluating a new expansion opportunity. The project requires an upfront investment of $10 million Gracen will also increase inventory by $10 million in year one. In year two, as Gracen increases credit sales, accounts receivable are expected to increase by $2 million. In year five, when the project is complete all accounts receivable will be collected. decreasing receivables by $2 million. Gracen will also decrease its inventory by $10 million. If the project produces operating cash flows of $4.0 million per year and Gracen's cost of capital is 12.5% what is the NPV of the project? $8.05 mil $1 37 mil $10.43 $0.43 mil