Cedar Falls Menswear is considering the addition of a line of shirts and ties. After tax...

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Cedar Falls Menswear is considering the addition of a line of shirts and ties. After tax cash outlays and after tax benefits each year for the 10-year planning horizon are shown below. The required return is 10 percent, and no salvage values are anticipated. Should the company invest in ei- ther or both lines? SHIRTS TIES SHIRTS & TIES Initial outlay $5,000,000 $1,000,000 $5,900,000 Annual after tax revenue 6,000,000 800,000 7,000,000 Annual after tax outlays Annual net cash flow 5,000,000 $1,000,000 700,000 5,800,000 $100,000 $1,200,000 Cedar Falls Menswear is considering the addition of a line of shirts and ties. After tax cash outlays and after tax benefits each year for the 10-year planning horizon are shown below. The required return is 10 percent, and no salvage values are anticipated. Should the company invest in ei- ther or both lines? SHIRTS TIES SHIRTS & TIES Initial outlay $5,000,000 $1,000,000 $5,900,000 Annual after tax revenue 6,000,000 800,000 7,000,000 Annual after tax outlays Annual net cash flow 5,000,000 $1,000,000 700,000 5,800,000 $100,000 $1,200,000