A company estimates they will sell 100,000 units (@$10/unit) of a new product starting from year 1 and sales will grow at 6% for four years until year 5. All sales are cash. Fixed costs are $400,000 annually. Variable costs are $5/unit. The new machinery to manufacture the product will cost $500,000 in year 0 and be depreciated straight line over the next five years. The tax rate is 34%. What are the annual operating cash flows? At the end of the period the machinery will be sold for $50,000 (after taxes) and no new sales will occur. What are the annual total cash flows? What is the NPV if the project has a 13% required return?