The Low Tec Corporation is about to begin producing and selling its prototype product. Annual cash flows for the next five years are forcasted as: 1 ($50,000) 2 ($20,000) 3 $100,000 4 $400,000 5 $800,000 Investors in LowTec have an expected rate of return of 30 percent on their investment until year 5, when the rate of return is expected to drop to 18%. The perpetuity growth rate for cash flows after Year 6 is expected to be 7 percent. Determine the present value for the LowTec venture.
Please show and explainall work.