You decide to start a baking company and run it for the next five years. To start the company, you need to buy a new commercial grade oven for $200,000 (t=0). Each year, you believe you can sell 30,000 loaves of bread and charge $6 per loaf (t=1 thru 5). Each year, you will also have to pay an assistant $23,000 and for space at the farmers market which will cost $1,000 (t=1 thru 5) treat these as costs not NWC or CAPEX. Finally, you will depreciate the oven by $20,000 each year (t=1 thru 5), and, after 5 years, the oven will be can be sold for $100,000 (t=5). The tax rate for your moving company is 27% and the discount rate is 10%.

What is FCF_5?

What is the NPV of this bakery project?