Temporary Housing Services Incorporated (THSI) is considering a project that requires an initial investment of $24 million to build a new plant and purchase equipment.The investment will be depreciated as a MACRS 7-year class asset.

Year 0 1 2 3 4 5 6 7

MACRS Depreciation Rate 14.29% 24.49% 17.49% 12.49% 8.93% 8.92% 8.93% 4.46%

The company will produce units at a cost of $130 each and will sell them for $420 each. Unit sales are expected to be 150,000 each year for the next 6 years, at which time the project will be abandoned.At that time, the plant and equipment is expected to be sold at $8 million (before tax). To supplement the production process, the company will need to purchase $1 million worth of inventory immediately.That inventory will be depleted during the final year of the project. The company has $100 million of debt outstanding with a yield-to-maturity of 8%, and has $150 million of equity outstanding with a beta of 0.9.The expected market return is 13% and the risk-free rate is 5%.The company's marginal tax rate is 40% and the firm considers the project an average risk project.Should the project be accepted? Justify your answer using the appropriate decision tools.

(the workouts are needed. especially for year 0

the NPV is $99.42 m)