Consider a project to supply Detroit with 31,000 tons of machine screws annually for automobile production. You will need an initial $6,200,000 investment in threading equipment to get the project started; the project will last for 5 years.

The accounting department estimates that annual fixed costs will be $1,500,000 and that variable costs should be $285 per ton; accounting will depreciate the initial fixed asset investment straight-line to zero over the 5-year project life. It also estimates a salvage value of $875,000 after dismantling costs. The marketing department estimates that the automakers will let the contract at a selling price of $404 per ton. The engineering department estimates you will need an initial net working capital investment of $600,000. You require a return of 13 percent and face a tax rate of 24 percent on this project.

a-1.What is the estimated OCF for this project?(Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.)

a-2.What is the estimated NPV for this project?(Do not round intermediate calculations and round your answer to 2 decimal places, e.g., 32.16.)b.Suppose you believe that the accounting department's initial cost and salvage value projections are accurate only to within 15 percent; the marketing department's price estimate is accurate only to within 10 percent; and the engineering department's net working capital estimate is accurate only to within 5 percent. What are your worst-case andbest-case NPVs for this project?(A negative answershould be indicated by a minus sign. Do not round intermediate calculations and round your answers to 2 decimal places, e.g., 32.16.)