Scenario Analysis: Estimated Cash Flows for the Toronto People Mover

Consider the scenario in which a competing form of transportation, the bicycle, causes sales to drop to 90% of expected sales from the base case.
Fill in the table on the right, including NPV

What is maximum opportunity cost of capital in both the Base Case and the Bicycle Scenario such that you should undertake the Toronto People MoverProject?

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Year 0Years12 Year 0 Years1-12 BicycleSce nario -5,400 BaseCase Investment Sales Variable Costs Fixed Costs Depreciati on Pretax profit Taxes @ 40% Profit after tax Operating cash flow Net Cash Flow NPF (OCCof9%) : $185 .37 Investment 5,400 16,000 Sales 13,000 Variable Costs 2,000 Fixed Costs 450 Depreciati on 550 Pretax profit 220 -Taxes @ 40% 330 Profit after tax 780 Operating cash flow 780 Net Cash Flow -5,400 5.400 NPV (OCCof 9%):