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10,900 sets. The cheap posts sell for $430 and have variable costs of $225 per set. The fixed costs each year will be $9,090,000. The

image text in transcribed 10,900 sets. The cheap posts sell for $430 and have variable costs of $225 per set. The fixed costs each year will be $9,090,000. The company has also spent $1,100,000 on research and development for the new posts. The plant and equipment required will cost $28,630,000 and will be depreciated on a straight-line basis. The new posts will also require an increase in net working capital of $1,290,000 that will be returned at the end of the project. The tax rate is 34 percent, and the cost of capital is 10 percent. a. Calculate the payback period. Payback Period= 32.161.) years (Do not round intermediate calculations and round your answer to 3 decimal places, e.g.., b. Calculate the NPV. (Do not round intermediate calculations and round your answer to 2 decimal places. e.g., 32.16.) c. Calculate the IRR. IRR = \% (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g.. 32.16.) Suppose you feel that the values are accurate to within only \pm 10 percent. What are the best-case and worst-case NPVs? (Hint: The price and variable costs for the two existing sets of posts ore known with certainty; only the sales goined or lost ore uncertoin.) (A negative answer should be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) d. Calculate the Best Case NPV. e. Calculate the Wort Case NPV. Worst Case NPV =$ What is the sensitivity of the NPV to the price and quantity of the new posts? (Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.) f. g. NPV/Q=$

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