ABC Manufacturing expects to sell 1,025 units of product in 2021 at an average price of $100,000 each based on current demand 2 The Chief Marketing Officer forecasts growth of 50 units per year through 2025. So, the demand will be 1,025 units in 2021, 1,075 units in 2012, etc. and the $100,000 price will remain consistent for all five years of the investment life. However, ABC cannot produce more 4 than 1,000 units annually based on current capacity 5 6 In order to meet demand, ABC must either update the current plant or replace it. If the plant is replaced, an initial working capital investment 7 of $5,000,000 is required and these funds will be released at the end of the investment life to be used elsewhere. 8. The following table summarizes the projected data for both options: 9 10 Update Replace 11 Initial investment in 2021 $ 115,000,000 $ 138,000,000 12 Terminal salvage value in 2025 $ 10,000,000 S 13 Working capital investment required $ $ 5,000,000 14 Useful life 5 years 5 years 15 Total annual cash operating costs per unit $ 70,000 $ 60.000 16 17 13 The investment will be made at the beginning of 2021 and all transactions after that are 19 assumed to occur on the last day of each year. ABC's required rate of return is 14% 20 21 1 Using Excel functions (NPV and/or PV functions) and formulas, calculate the net presentato (NPV) for both the update and replace alternatives, 22 23 ANSWER IS 24 Net Present Value of Update Option 25 26 Net Present Value of Replace Option ZI 23 My Cuestion is I do not know how to get these values to be these answers I keep trying and it will not workout 30 32