Revenues generated by a new fad product are forecast as follows:

YEAR	REVENUES
1	$45000
2	$35000
3	$25000
4	$20000
Thereafter	$0

Expenses are expected to be 40% of revenues, and working capital required in each year is expected to be 20% of revenues in the following year. The product requires an immediate investment of $60,000 in plant and equipment.

What is the initial investment in the product? Remember working capital.

Initial Investment = $ _______

If the plant and equipment are depreciated over 4 years to a salvage value of zero using straight-line depreciation, and the firms tax rate is 20%, what are the project cash flows in each year? (Enter your answers in thousands of dollars. Do not round intermediate calculations. Round your answers to 2 decimal places.)

YEAR	CASH FLOW
1	$
2	$
3	$
4	$

If the opportunity cost of capital is 12%, what is project NPV? (Negative amount should be indicated by a minus sign. Do not round intermediate calculations. Round your answer to 2 decimal places.)

NPV = $ ________

What is project IRR? (Do not round intermediate calculations. Round your answer to 2 decimal places.)

IRR = __________ %