Herjavec Enterprises is thinking about Introducing a new surface cleaning machine. The

marketing department has come up with the estlmate that the company can sell $14$ units

per year at $$312000$ net cash flow per unlt for the next slx years. The englineering

department has come up with the estlmate that developing the machine will take a $$15\mathrm{.}7$

million Initlal Investment. The finance department has estlmated that a discount rate of $17$

percent should be used.

a$.$ What is the base$-$case NPV$?($A negative answer should be indicated by a minus

sign. Do not round intermediate calculations and enter your answer in dollars, not

millions of dollars, rounded to $2$ decimal places, e$.$g$.,1,234,567\mathrm{.}89.)$

b$.$ If unsuccessful, after the first year, the project can be dismantled and will have an

aftertax salvage value of $$11\mathrm{.}7$ million. Also, after the first year expected cash flows will

be revlsed up to $19$ unlts per year or down to $0$ units with equal probability. What is

the revised NPV$?($Do not round intermediate calculations and enter your answer in

dollars, not millions of dollars, rounded to $2$ decimal places, e$.$g$.,1,234,567\mathrm{.}89.)$