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

Year	Revenues
1	$40,000
2	30,000
3	20,000
4	5,000
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 $49,000 in plant and equipment. a. What is the initial investment in the product? Remember working capital. Initial investment = $_______

b. 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

c. If the opportunity cost of capital is 10%, 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 = _______

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

IRR = ________