The incremental revenue generated by a 4-year project is given in the worksheet below. Variable costs are expected to be 60 percent of revenues, and working capital required in each year is expected to be 20 percent of revenues in the following year. Fixed cash cost are expected to be $200 annually in the first two years, $250 annually in the last two years. This 4- year project requires an immediate investment of $1000 in plant and equipment Plant and equipment are to be depreciated toward O value using the 7-year MACRS schedule. At the end of the project the equipment can be sold for $200. The tax rate is 40% and the required return is 15%. When is a project acceptable using the NPV criterion? Is this project acceptable using the NPV criterion? When is a project acceptable using the RR criterion? Is this project acceptable using the RR criterion? Year 0 Year 1 2.000.0 Year 2 2.500,0 Year 3 2.000.0 Year 4 1,500.0 Revenue Variable Cost Fixed Cash cost EBITDA Depreciation DEBIT Tax NOPAT Depreciation Operating Cash Flow Investment in NWC Investment in Fixed Assets FCF WACC NPV IRR Year o Year 1 Year 2 Year 3 Year 4 Projected NWC Level Investment in NWC MACRS Depreciation rate Hist Cost of Fixed Assets -Acc Depreciation Ending Book Value Salvage Value Captial Gains Tax Net Proceeds from Sale of Fixed Assets