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Problem: The CFO of Casio Industries is considering the launch of a new fuel cell powered calculator to its existing line of college supplies. The horizon of the project has been estimated to be 10 years. The machine that will manufacture the calculators costs $3 million, and will be depreciated using the straight line method to zero book value over 15 years. Projected sales are $500,000 in year 1,$550,000 in year 2,$600,000 in year 3, and so on ($50,000 increase until year 10). Annual costs are estimated to be 20% of the current year sales. The CFO believes that the machine can be sold at the end of the project for $600,000. Working capital requirements are estimated to be 5% of the following year sales (so NWC at time 0 is 5% of sales at time 1 , and so forth). If the project is taken, it will use an existing office space for which the company paid $550,000 three years ago, and that can be rented today for $40,000 a year, to be paid at the end of each year. The tax rate is 40%. Questions: a) Forecast the project (unlevered) cash flows that you should discount. b) What is the NPV of the project if the cost of capital (discount rate) is 10%