Need help with the question below. Just feeling rather lost... Even if you go about using different numbers an overview how to tackle whats requested would be incredibly helpful!

Eight Ball Fabricating (EBF) manufactures springs and related components for a variety of industrial and consumer end products. EBF is evaluating a new business opportunity. In response to the growing health consciousness of the affluent aging baby boomer generation, a new concept in traction-associated exercise equipment is being developed. EBF feels confident it can be a supplier of choice of the high quality springs needed for this new generation of equipment. EBF has determined that its existing manufacturing facilities are not suitable for the manufacture of the type of spring needed. Hence, in order to evaluate whether to enter this market, EBF needs to consider the return on investment in a new manufacturing facility. EBF has identified two options for its potential new manufacturing site:

Option A: Renovation of an existing warehouse (economic life of 10 years)

Option B: Construction of a completely new facility (economic life of 20 years)

EBF projects it will be able to sell 8,000 spring sets per year for the foreseeable future. Price per spring set is $799 (in year end 1 dollars). EBF has employed a nominal discount rate of 8.5 percent on similar construction projects in the past. EBF's federal tax rate is 21 percent. The following additional data have been collected. Assume all cash flows occur at the end of the year. Inflation is 3 percent per year.

Depreciation expense is to be calculated in two different ways: (1) according to the rules of the new tax regime, where depreciation expense is booked only in year 1 of each proposed project;

(2) according to the old and perhaps future tax regime, where depreciation expense is spread out over the lives of the assets. For simplicity, assume straight line depreciation with no salvage value on the assets.