As a project manager, you need to update the status of your current project to the management.

You have been allocated a capital budgeting to managing a larger$-$scale decisions by firm. Assume that a firm considers opening up a new store, which would require an initial outlay of RM$2,000,000.$ The firm has estimated its revenue and expenses as shown in Table $3$ below.

Table $3$: Data for Revenue and Expenses in RM Millions

End of Year

Revenue $($RM million$)$

Expenses $($RM million$)$

$1$

$8$

$8$

$2$

$10$

$8$

$3$

$12$

$10$

$4$

$14$

$10$

After the end of four years, the firm expects to sell the store for RM$1,000,000$ as salvage value. The firm requires a $20$ per cent rate of return on this project. Assume a tax rate of $30\%$ charged on earnings generated by the project.

Determine the Net Present Value $($NPV$)$ for this project and proposed your recommendation to management regarding on this proposed project.