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Can you please answer a,b, and c putting the numbers in the formula and showing work please Perot Corporation is developing a new CFL based

Can you please answer a,b, and c
putting the numbers in the formula and showing work please image text in transcribed
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Perot Corporation is developing a new CFL based on a new type of technology, Its new chip, the Patay 2 chlp, will take two years to develop. However, because other chip manufacturers will be able to copy the technology, it will have a market life of two years after it is introduced. Perot expects to be able to price the chip higher in the first year, and it anticipates a significant production cost reduction after the first year. The relevant information for developing and seling the Potay 2 is given as follows: Assume all cash flows occur at the end of each period. a. What are the yearly cash flows and their present value (discounted at 10 percent) of this project? What is the net present value? Note: Enter your answer in thousands of dollars. Round your answer to the nearest thousand. b. Perot's engineers have determined that spending $10 million more on development will allow them to add even more advanced features. Having a more advanced chip will allow them to price the chip $50 higher in both years (\$870 for year 1 and $700 for year 2). What is the NPV of the project if this option is implemented? Note: Enter your answer in thousands of dollars. Round your answer to the nearest thousand. c. If sales are only 200,000 the first year and 100,000 the second year, what would the NPV of the project be? Assume the development costs and sals price are as originally estimated. Note: Enter your answer in thousands of dollars. Round your answer to the nearest thousand. Perot Corporation is developing a new CFL based on a new type of technology, Its new chip, the Patay 2 chlp, will take two years to develop. However, because other chip manufacturers will be able to copy the technology, it will have a market life of two years after it is introduced. Perot expects to be able to price the chip higher in the first year, and it anticipates a significant production cost reduction after the first year. The relevant information for developing and seling the Potay 2 is given as follows: Assume all cash flows occur at the end of each period. a. What are the yearly cash flows and their present value (discounted at 10 percent) of this project? What is the net present value? Note: Enter your answer in thousands of dollars. Round your answer to the nearest thousand. b. Perot's engineers have determined that spending $10 million more on development will allow them to add even more advanced features. Having a more advanced chip will allow them to price the chip $50 higher in both years (\$870 for year 1 and $700 for year 2). What is the NPV of the project if this option is implemented? Note: Enter your answer in thousands of dollars. Round your answer to the nearest thousand. c. If sales are only 200,000 the first year and 100,000 the second year, what would the NPV of the project be? Assume the development costs and sals price are as originally estimated. Note: Enter your answer in thousands of dollars. Round your answer to the nearest thousand

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