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We project unit sales for a new household - use laser - guided cockroach search and destroy system as follows: Year Unit Sales 1 1

We project unit sales for a new household-use laser-guided cockroach search and destroy system as follows:
Year Unit Sales
1101,000
2113,000
3136,000
4142,000
595,000
The new system will be priced to sell at $475 each.
The cockroach eradicator project will require $2,200,000 in net working capital to start, and total net working capital will rise to 15% of the change in sales. The variable cost per unit is $345, and total fixed costs are $2,500,000 per year. The equipment necessary to begin production will cost a total of $22 million. This equipment is mostly industrial machinery and thus qualifies for CCA at a rate of 20%. In five years, this equipment will actually be worth about 20% of its cost.
The relevant tax rate is 35%, and the required return is 17%. Based on these preliminary estimates, what is the NPV of the project? (Enter the answer in dollars. Do not round your intermediate calculations. Round the final answer to 2 decimal places. Omit $ sign in your response.)
NPV $

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