extensive research, it has prepared the incremental free cash flow projections shown below (in millions of dollars): a. For this base-case scenario, what is the NPV of the plant to manufacture lightweight trucks? revenues are 8% higher than forecast? What is the NPV if revenues are 8% lower than forecast? operating expenses grow by 6% per year rather than by 2%? ranging from 5% to 30%. For what ranges of discount rates does the project have a positive NPV? \begin{tabular}{lrrr} Year & 0 & 19 & \multicolumn{1}{c}{10} \\ \hline Revenues & & 96.4 & 96.4 \\ Manufacturing Expenses (other than depreciation) & & 35.6 & 35.6 \\ Marketing Expenses & & 10.3 & 10.3 \\ Depreciation & & 15.1 & 15.1 \\ EBIT & & 35.4 & 35.4 \\ Taxes at 21\% & & 7.4 & 7.4 \\ Unlevered Net Income & & 28.0 & 28.0 \\ Depreciation & & +15.1 & +15.1 \\ Additions to Net Working Capital & & 4.8 & 4.8 \\ Capital Expenditures & & & +11.7 \\ Continuation Value & & & 50.7 \\ Free Cash Flow & 150.7 & 38.3 & 5 \end{tabular} a. For this base-case scenario, what is the NPV of the plant to manufacture lightweight trucks? The NPV of the plant to manufacture lightweight trucks, based on the estimated free cash flow is : million. (Round to two decimal places.) are 8% higher than forecast? What is the NPV if revenues are 8% lower than forecast? The NPVof this project if revenues are 8% higher than forecast is $ million. (Round to two decimal places.) The NPV of this project if revenues are 8% lower than forecast is million. (Round to two decimal places.) from 5% to 30%. For what ranges of discount rates does the project have a positive NPV? The NPV is positive for discount rates below the IRR of . (Round to one decimal place.) extensive research, it has prepared the incremental free cash flow projections shown below (in millions of dollars): a. For this base-case scenario, what is the NPV of the plant to manufacture lightweight trucks? revenues are 8% higher than forecast? What is the NPV if revenues are 8% lower than forecast? operating expenses grow by 6% per year rather than by 2%? ranging from 5% to 30%. For what ranges of discount rates does the project have a positive NPV? \begin{tabular}{lrrr} Year & 0 & 19 & \multicolumn{1}{c}{10} \\ \hline Revenues & & 96.4 & 96.4 \\ Manufacturing Expenses (other than depreciation) & & 35.6 & 35.6 \\ Marketing Expenses & & 10.3 & 10.3 \\ Depreciation & & 15.1 & 15.1 \\ EBIT & & 35.4 & 35.4 \\ Taxes at 21\% & & 7.4 & 7.4 \\ Unlevered Net Income & & 28.0 & 28.0 \\ Depreciation & & +15.1 & +15.1 \\ Additions to Net Working Capital & & 4.8 & 4.8 \\ Capital Expenditures & & & +11.7 \\ Continuation Value & & & 50.7 \\ Free Cash Flow & 150.7 & 38.3 & 5 \end{tabular} a. For this base-case scenario, what is the NPV of the plant to manufacture lightweight trucks? The NPV of the plant to manufacture lightweight trucks, based on the estimated free cash flow is : million. (Round to two decimal places.) are 8% higher than forecast? What is the NPV if revenues are 8% lower than forecast? The NPVof this project if revenues are 8% higher than forecast is $ million. (Round to two decimal places.) The NPV of this project if revenues are 8% lower than forecast is million. (Round to two decimal places.) from 5% to 30%. For what ranges of discount rates does the project have a positive NPV? The NPV is positive for discount rates below the IRR of . (Round to one decimal place.)
