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Homework: Chapter 13 Homework Save Score: 0 of 6 pts 1 of 2 (2 complete) HW Score: 33.33%, 3 of 9 pts XP13-7 (similar to) Question Help (Related to Checkpoint 13.2 and Checkpoint 13.3) (Comprehensive risk analysis) Blinkeria is considering introducing a new line of hand scanners that can be used to copy material and then download it into a personal computer. These scanners are expected to sell for an average price of $103 each, and the company analysts performing the analysis expect that the firm can sell 105,000 units per year at this price for a period of five years, after which time they expect demand for the product to end as a result of new technology. In addition, variable costs are expected to be $18 per unit and fixed costs, not including depreciation, are forecast to be $1,000,000 per year. To manufacture this product, Blinkeria will nood to buy a computerized production machine for $10.7 million that has no residual or salvage value, and will have an expected life of five years. In addition, the firm expects it will have to invest an additional $307,000 in working capital to support the new business. Other pertinent Information concerning the business venture is provided here: a. Calculate the project's NPV. b. Determine the sensitivity of the project's NPV to ain) 8 percent decrease in the number of unils sold. c. Determine the sensitivity of the project's NPV to ain) 8 percent decrease in the price per unit. d. Determine the sensitivity of the project's NPV to ain) 8 percent increase in the variable cost per unit. o. Determine the sensitivity of the project's NPV to ain) 8 percent increase in the annual fixed operating costs. t. Use scenario analysis to evaluate the project's NPV under worst- and best-case scenarios for the project's value drivers. The values for the expected or base-case along with the worst- and best-case scenarios are listed here: . a. The NPV for the base-case will be $ 12,185,481 (Round to the nearest dollar.) b. The project's NPV to ain) 8 percent decrease in the number of units sold will be $ . (Round to the nearest dollar) Enter your answer in the answer box and then click Check Answer. 5 parts remaining Clear All Check Answer Homework: Chapter 13 Homework Save Score: 0 of 6 pts 1 of 2 (2 complete) HW Score: 33.33%, 3 of 9 pts X P13-7 (similar to) Question Help (Related to Checkpoint 13.2 and Checkpoint 13.3) (Comprehensive risk analysis) Blinkeria is considering introducing a new line of hand scanners that can be used to copy material and then download it into a personal computer. These scanners are expected to sell for an average price of $103 Bach, and the corripany analysis perfomning the analysis expect that the fimmn cari soll 105.000 units per year at this price for a period of five years, after which time they expect derriand for the product to end as a result of new technology. In addition, variable costs are expected to be $18 per unit and fixed costs, not including depreciation, are forecast to be S1.000.000 per year. To manufacture this product, Blinkeria will need to buy a computerized production machine for $10.7 million that has no residual or salvage value, and will have an expected life of five years. In addition, the firm expects it will have to invest an additional $307,000 in working capital to support the new business. Other pertinent information concerning the business venture is provided here: i Data Table a. Calculate the project's NPV. b. Determine the sensitivity of the project's NPV to a{n) 8 percent decrease c. Determine the sensitivity of the project's NPV to ain) 8 percent decrease d. Determine the sensitivity of the projec's NPV lo ain) 8 percent increase e. Determine the sensitivity of the project's NPV to ain) 8 percent increase i f. Use scenario analysis to evaluate the project's NPV under worst- and bes $10.700.000 5 years ng with the worst- and best-case scenarios are listed here: a. The NPV for the base-case will be $ 12,185,461. (Round to the nearest b. The project's NPV to a[n) 8 percent decrease in the number of units sold Initial cost of the machine Expected life Salvage value of the machine Working capital requirement Depreciation method Depreciation expense Cash fixed costs-excluding depreciation Variable costs per unit Required rate of return or cost of capital Tax rate $307,000 straight line $2.140,000 per year $1,000,000 per year $18 9.3% 34% Print Done Enter your answer in the answer box and then click Check Answer. 5 5 parts remaining Clear All Check