Excel #2 Oakmont Company has an opportunity to manufacture and sell a new product for a four-year period. After careful study, Oakmont estimated the following costs and revenues for the new product: So the working capital needed means that more cash will need to be invested in inventory and other working capital items. When the project concludes in four years the working capital will be released for investment elsewhere within the company, meaning that the cash will be recovered at the end of the 4 years. Required: Using Excel answer the following: (a) Oakmont's cost of capital is 15%, and management does not feel it should have any adjustment for risk, compute the NPV. (b) Compute the IRR for this project. (c) Management thinks that if they can spend another $10,000 on advertising each of the next 4 years (at the end of the year), it will cause sales volume to increase by 10% for each of the next 4 So the working capital needed means that more cash will need to be invested in inventory and other working capital items. When the project concludes in four years the working capital will be released for investment elsewhere within the company, meaning that the cash will be recovered at the end of the 4 years. Required: Using Excel answer the following: (a) Oakmont's cost of capital is 15%, and management does not feel it should have any adjustment for risk, compute the NPV. (b) Compute the IRR for this project. (c) Management thinks that if they can spend another $10,000 on advertising each of the next 4 years (at the end of the year), it will cause sales volume to increase by 10% for each of the next 4 years (the 10% will increase for each year over year, starting with the first year). (Assume all cash flows occur at the end of the year) Compute NPV using a 19\% cost of capital. (a and b worth 5 points, c worth 5 points) (d) For the video, I want you to discuss (between 3-5 minutes) your computations for (c) only. Start with your base assumption in (a) for your cash flows, how you did the adjustments for the requirements in C, and your final response of whether you think the extra 10,000 spent on advertising is worthwhile vs, what you were going to do in (a). 5 points