Exhibit I: A firm is considering a 3-year project with the following information: In Year 0: New equipment will be purchased for $400,000. Inventories will rise by $60,000 and accounts payable will rise by $25,000. In Years 1 through 3: In Years 1 and 2, net working capital will not change. In Year 3, net working capital will be fully recovered. In Years I through 3, Operating Cash Flow will be $63,600 per year. In Year 3, equipment will be sold for $40,000 (before-tax). Equipment will be depreciated using MACRS rates of 33%, 45%, 15%, 7% in Years 1, 2, 3, 4. Tax rate = 40%. In addition to information in Exhibit I, you have realized new facts. The new equipment will be operated in a vacant building already owned by the firm. The firm purchased the building for $200,000 two years ago and estimates that selling the building today would result in an after-tax cash flow of $300,000. Considering this additional information, what is the project's initial investment cash flow (a.k.a. cash flow from investment in Year 0)? O a. -$660,000 -$760,000 Ob O c $735,000 -$700,000 d. -$635,000 e