Red Rock Lobster (RRL) is looking to expand its business. The new business would generate $2.5 million per year in sales over the next 5 years. Annual costs would increase by Analysis $2.1 million. An investment in working capital of $50,000 would have to be made initially. The machinery (CCA rate of 30%) would cost $700,000, with additional costs of $10,000 and $20,000 to be incurred for setup and training. RRL estimates that it would be possible to sell the equipment for 10% of its initial value at the end of 5 years. The company would set up operations in a building it does not use but does rent out for $100,000 per year. If RRL's cost of capital is 12% and its tax rate is 28%, should it proceed with this per year. If RRL's cost of capital is 12% and its tax rate is 28%, should it proceed with this new business?