RET Inc. currently has two products, low and high priced stoves. RET Inc. has decided to sell a new line of medium$-$priced stoves. Sales revenues for the new line of stoves are estimated at $$3,000$ a year. Variable costs are $80\%$ of sales. The project is expected to last $10$ years. Also, non$-$variable costs are $$400$ per year. The company has spent $$100$ in research and a marketing study that determined the company will have synergy gains$/$sales of $$400$ a year from sales of its existing high$-$priced stoves. The production variable cost of these sales is $$200$ a year.

The plant and equipment required for producing the new line of stoves costs $$600$ and will be depreciated down to zero over $30$ years using straight$-$line depreciation. It is expected that the plant and equipment can be sold $($salvage value$)$ for $$200$ at the end of $10$ years. The new stoves will also require today an increase in net working capital of $$100$ that will be returned at the end of the project.

The tax rate is $25$ percent and the cost of capital is $10\%$