Question
Enter these given data in the appropriate fields. Then complete the calculations in the yellow fields to eventually calculate the net present value and price
Enter these given data in the appropriate fields. Then complete the calculations in the yellow fields to eventually calculate the net present value and price per share impact.
Project information: XXX Motors is evaluating a large investment into a self-driving/ safety project. Relevant costs and benefits are listed below remember that some of these are inflows and others are outflows of cash:
Cost to develop the technology $8,000,000,000.
Additional revenue per vehicle sold $1200.
Number of cars sold with this feature 2,000,000.
Fixed Cost to update the technology $100,000,000.
Variable cost of installation per vehicle $100
Amortization of the cost to develop the technology $80,000,000.
Tax rate 28%
Disposition value of technology $0
Weighted average cost of capital 8.00%
Number of shares outstanding 500,000,000.
E F G H J 2024 2025 2026 2027 2028 2029 $ $ $ $ $ $ B D 1 Net present value -- Week 4 -- Practice Set: 2 Acquisition stage cash flow: 3 Cost of developing the automated technology $ (8,000) (in millions of dollars) 4 Operating stage cash flow: 5 Year 0 2022 2023 6 Number of units sold with this feature (not in millions) 2,000,000 7 Premium charge per vehicle 8 All amounts below are in millions: 9 Sales (in millions) $ $ 10 Fixed Cost of updating the technology $ (100) 11 Variable Cost of installing the technology $ (100) 12 Amortization of the development costs $ (80) 13 Taxable income 14 Taxes at 28% $ $ 15 After tax income 16 Add back amortization $ 80 $ 17 Operating cash flows 18 19 Disposition stage cash flow: 20 21 Total cash flow $ (8,000) 22 Present Value 23 Net Present Value 24 Number of share of common stock outstanding 500,000 25 Expected increase in value per share $ $ $ $ $ S S S $ - $ $ 2028 2029 2030 2031 $ $ $ $ $ $ $ EA $ $ $ GA $Step by Step Solution
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