Your company has been doing well, reaching $$1\mathrm{.}06$ million in earnings, and is considering launching a new product. Designing the new product has already cost $$464,000.$ The company estimates that it will sell

$779,000$ units per year for $$3\mathrm{.}08$ per unit and variable non$-$labor costs will be $$1\mathrm{.}06$ per unit. Production will end after year $3.$ New equipment costing $$1\mathrm{.}09$ million will be required. The equipment will be

depreciated to zero using the $7-$year MACRS schedule. You plan to sell the equipment for book value at the end of year $3.$ Your current level of working capital is $$307,000.$ The new product will require the

working capital to increase to a level of $$383,000$ immediately, then to $$399,000$ in year $1,$ in year $2$ the level will be $$350,000,$ and finally in year $3$ the level will return to $$307,000.$ Your tax rate is $25\%.$ The

discount rate for this project is $9\mathrm{.}9\%.$ Do the capital budgeting analysis for this project and calculate its NPV$.$

Note: Assume that the equipment is put into use in year $1.$

Design already happened and is sunk

According to the $7-$year MACRS schedule, depreciation in year $1$ will be $

$($irrelevant$).($Select from the drop$-$down menu.$)$

$.($Round to the nearest dollar.$)$