The director of RMC Inc plans to launch a new product. investment

The initial cost of equipment and other facilities is $$600,000.$ This makes a

general management has been considering launching this new product for some time. They

made several trips to different cities to estimate future demand

of the new product. These trips cost the company approximately $$100,000$

so far. The lifespan of the project is estimated at $5$ years. Turnover

of year $1$ should be $1000,000,$ and the turnover should remain the same

throughout the duration of the project. The operating costs of the project are estimated at

$$600,000$ per year. If the project is undertaken, the total investment in the fund

net turnover will initially increase by $$100,000,$ but the company will recover

$50\%$ of its investment in net working capital at the end of the fifth

year. The tax rate is $30\%$ and the tax depreciation rate is $20$

$\%.$ The equipment can be sold at the end of the project for $$200,000.$ Furthermore, a

team of consultants was tasked with carrying out a study on the potential of

demand for the product. The agreement concluded with the consulting company provides that it will not

will receive the consulting fees $($$$20,000)$ only when the project is undertaken. THE

appropriate discount rate for the project is $11\mathrm{.}7\%.$ Calculate the cost of

the initial investment at time zero and the present value of the tax savings?