. Your firm has just developed a new handheld PDA code named The Model A. To produce Model A the firm would need to invest $20 million in new plant and equipment. The firm would sell Model A for a per unit profit of $200. Sales are expected to be 30,000 units in Year 1; 40,000 in Year 2; and 50,000 in Year 3. Networking capital and taxes are zero. The WACC is 12%. Model B will replace Model A in Year 4, with the same price and unit costs. Sales are forecasted to be 60,000 units in Year 4, 80,000 in Year 5 and 100,000 in Year 6. Model B would require $30 million in new plant and equipment in Year 3. What is the projects NPV? Should your firm proceed with the investment? Identify all numbers and show all work. What if Model B requires an investment of $40 million?