You are the CEO of Long Short Inc. $($LSI$),$ a golf ball manufacturer. LSI's R&D department spent $$4\mathrm{.}08$ million

earlier this year $($year $0)$ to design the firm's latest golf ball, the Pro$-$Shot V$.$ To launch the new golf balls would

require an additional investment this year $(t=0)$ of $$10\mathrm{.}10$ million in new machinery as well as an increase in

working capital of $$2\mathrm{.}70$ million also this year $(t=0).$ The product is expected to have a life of $5$ years $(t=5)$

and then becomes obsolete. Capital expenditures can be depreciated linearly to zero over five years and the

working capital will stay at the same level over the product's life after which it can be reduced to $0.$

The new golf balls are expected to produce annual revenue by $$6\mathrm{.}42$ million over its lifetime $($i$.$e$.,$ from year

$t=1$ to year $t=5)$ with annual production costs at $40\%$ of revenue. The new product line is expected to

reduce profit before tax on its prior line of golf balls, the Pro$-$Shot IV$,$ by $$0\mathrm{.}49$ million. LSI has a corporate tax

rate of $31\mathrm{.}93\%$ and a cost of capital of $12\mathrm{.}79\%.$ Assume all cash flows occur at year$-$end and it is now the end

of year $0.$

Use the above information to answer questions $($A$)-($F$).$

A$.$ What is the pre$-$tax annual operating profit generated by the new product in year $1$ to $4?$

B$.$ What is the annual depreciation from the new product in year $1$ to $5?$

C$.$ What is the after$-$tax cash flow generated by the new product in year $0?$ Input a negative value if cash flow is negative.

D$.$ What is the annual after$-$tax cash flow generated by the new product each year in years $1,2,3,$ and $4?$ Input a negative value if cash flow is negative.

E$.$ What is the annual after$-$tax cash flow generated by the new product in year $5?$ Input a negative value if cash flow is negative.

F$.$ What is the NPV of launching the new product?