Problem One . . Fool Proof Software is considering an expansion project having life for four years. The proposed project has the following features. Initial cost of the equipment is $200,000, with shipping cost $10,000 and installation cost of $30,000. The equipment will depreciate over 4 years using MACRS at the following rates (33%, 45%, 15%, and 7%). Inventories will increase by $25,000, and accounts payable will rise by $5,000 The company will sell 120,000 units per year with a price of $2/unit. The company's total operating cost will equal $120,000 each year, plus research and development costs $30,000 each year, The project salvage valve is $25,000. The company's tax rate is 40%. The project's WACC is 10% 1. What is the net cost of the equipment for capital budgeting purposes? (Hint: Calculate the initial investment outlay). O $200,000 O $210,000 $240,000 O $260,000 O None of the above