Consider a project to supply 119 million postage stamps per year to the U.S. Postal Service for the next five years. You have an idle parcel of land available that cost $2,090,000 five years ago; if the land were sold today, it would net you $2,290,000 aftertax. The land can be sold for $2,490,000 after taxes in five years. You will need to install $5.59 million in new manufacturing plant and equipment to actually produce the stamps; this plant and equipment will be depreciated straight-line to zero over the project’s five-year life. The equipment can be sold for $690,000 at the end of the project. You will also need $790,000 in initial net working capital for the project, and an additional investment of $69,000 in every year thereafter. Your production costs are .69 cents per stamp, and you have fixed costs of $930,000 per year. If your tax rate is 35 percent and your required return on this project is 11 percent, what bid price should you submit on the contract?