BF (This information will be used for problems 27 - 33) Silvio's Sausage Factory has come up with a new line of spicy sausages. Silvio has already paid $75,000 for a marketing study to determine the viability of the product. It is believed that the new line of sausages will generate sales for each year of: Year 1$625,000; Year 2$650,000; Year 3 $700,000; and Year 4$750,000. The fixed costs associated with the product will be $315,000 per year, and variable costs will amount to 22% of sales. The equipment necessary for production of the new sausages will cost $596,000 and will be a depreciated to zero using straight line depreciation over four years. At the end of the four years Silvio believes the equipment will have a salvage value of $45,000. Silvio's Sausage paid 35% in taxes last year and has a required rate of return of 13%. No additional working capital is required. BG Would you recommend that Silvio invest in the project? Not sure No Yes