The bank is looking to open a new bank branch to extend its network in South Carolina. Use the following data to determine if the individual should open the branch or not. 1. The initial cost of the branch (building and equipment) is $1,000,000 and is expected to have a useful life of 5 years. 2. Both the building and equipment are depreciated on a 7-year MACRS schedule with annual depreciation rates of 14.29%, 24.49%, 17.49%, 12.49%, 8.93%, 8.92%, 8.93%, and 4.46%. The building and equipment can be sold for $115,000 at the end of 5 years. 3. The building will be built on a piece of land that the bank purchased 3 years ago for $100,00. The lands current market value is $125,000. 4. At the end of 5 years, the market value of the land is expected to be $90,000. 5. The building is to built on a piece of land that will be leased at a price of $20,000 a year. 6. NWC must increase by $50,000 to get the bank up and running. 7. The bank expects revenues in year 1 to be $400,000 and increase by 5% each year thereafter. 8. Due to the location of the branch, the banks main branch is expected to lose $50,000 a year in revenues. 9. Operating expenses are expected to be $100,000 in years 1 and 2, but rise by 3% per year thereafter. 10. The firms marginal tax rate is 30%. 11. The bank has a current YTM on its debt of 5.3%, its beta is 0.93, the current 10-year Treasury yields 4.26%, and the market risk premium is currently at 6.6%. Additionally, the bank's preferred stock currently has a required return of 6.38%. Finally, the individual believes its optimal capital structure is 10% preferred, 35% debt, and 55% common.

PLEASE GO THROUGH THE STEPS AND CALCULATIONS WITH VALUES ON HOW TO DO THIS (npv, irr, pi, payback), etc.