Blooper's analysts have come up with the following revised estimates for its magnoosium mine:

Range

PessimisticOptimisticInitial investment+30%-25%Revenues-15%+20%Variable costs+15%-20%Fixed cost+30%-20%Working capital+30%-50%

Conduct a sensitivity analysis for each variable and range and compute the NPV for each. UseSpreadsheet 10.1and accompanying data as a starting point for the analysis.(Do not round intermediate calculations. Negative amounts should be indicated by a minus sign. Enter your answers in thousands rounded to the nearest whole dollar.)

Spreadsheet 10.1

A. InputsInitial investment ($ thousands)10,000Salvage value ($ thousands)2,000Initial revenues ($ thousands)15,000Variable costs (% of revenues)40.0%Initial fixed costs ($ thousands)4,000Inflation rate (%)5.0%Discount rate (%)12.0%Receivables (% of sales)16.7%Inventory (% of next year's costs)15.0%Tax rate (%)21.0%Year:0123456B. Fixed assetsInvestments in fixed assets10,000Sales of fixed assets1,580Cash flow from fixed assets-10,0001,580C. Operating cash flowRevenues15,00015,75016,53817,36418,233Variable expenses6,0006,3006,6156,9467,293Fixed expenses4,0004,2004,4104,6314,862Depreciation2,0002,0002,0002,0002,000Pretax profit3,0003,2503,5133,7884,078Tax630683738796856Profit after tax2,3702,5682,7752,9933,221Operating cash flow4,3704,5684,7754,9935,221D. Working capitalWorking capital1,5004,0754,2794,4934,7173,0390Change in working capital1,5002,575204214225-1,679-3,039Cash flow from investment in working capital-1,500-2,575-204-214-2251,6793,0390.4080.4080.4080.4080.250E. Project valuationTotal project cash flow-11,5001,7954,3644,5614,7686,9004,619Discount factor1.0000.8930.7970.7120.6360.5670.507PV of cash flow-11,5001,6033,4793,2463,0303,9152,340Net present value6,113.1