You're the CFO of the tech company, BubeePop. Your CMO (Chief Marketing Officer} is proposing a new product called APPKiIIer that will be sold online for $10 per unit. The CMU expects sales of 100,000, 110,000, 120,000, 90,000 and 70,000 units over the products 5 year life. C065 is 20% of sales and operating expenses are estimated at $350,000 per year. The company's tax rate is 30%. The initial investment in the project is as follows. El $1,000,000 for fixed equipment machinery El $200,000 in initial raw materials The machinery is depreciated over 8 years straightline [$125,000 per year). t the end of 5 years, the product is expected to become obsolete. The machinery will be sold off for $600,000 at that time. Raw materials will be sold off netting the company the $200,000 back that they had originally invested. FYI, the company has already spent $75k on an overpriced consultant last year analyzing this deal. (I heard he was a college professor in RI). Oh, and about their WCC ...... El The company's stock is trading for $20 per share. There are 50,000 shares outstanding. Company beta is 2.0. The market risk premium is 6% and the risk free rate of return is 3%. El Corporate debt matures in 2020 and is trading at 90% on 300 bonds with a par value of $1,000. The coupon rate is 10%. The bonds pay coupons semiannually (2): per year}. El The company has a small amount of Preferred stock. 2,000 shares trading at $90. Par value is $100 and annual income on the Preferred stock is 9.5%. Using NPV, should the company invest in the APPKiIIer project