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please help using excel Part A: The Long-Life Company has a new vaccine. The company estimates that it has a 10-year monopoly on the production

please help using excel

Part A: The Long-Life Company has a new vaccine. The company estimates that it has a 10-year monopoly on the production of the vaccine, and it is trying to estimate how many vaccines it should try to sell annually.

Machines to produce the new vaccine cost $70 million, have a 5-year life, and zero salvage value. The machines are depreciated using the 7-year MACRS depreciation schedule. Each machine is capable of producing 75,000 vaccines annually. Annual fixed costs for producing the vaccine are $35 million, and the variable cost per vaccine is $1,000. Long-life plans to sell the vaccine at a price of $1,500 per vaccine. The companys discount rate for this type of vaccine is 15%, and its corporate tax rate is 30%.

please help using excel

  1. Write a formula in cell B15 to calculate the number of machines Long-Life will need to purchase to meet expected demand. Hint: The ROUNDUP formula may be helpful.

  1. If Long-Life expects to sell 250,000 vaccines each year, what are the NPV and IRR of the product over its 10-year life?

  1. Create a two-way data table to analyze the sensitivity of NPV to the number of vaccines sold annually and the discount rate. Assume the discount rate ranges between 10% and 25%, by increments of 3%, and annual sales takes on one of the following values: 100-300K in increments of 40k

4. Using the results from part 3, make an argument for the optimal number of vaccines to produce.

  1. Set annual vaccines sold to a value of 200,000 and use GOAL SEEK to calculate the number of breakeven units, i.e., number of units sold that makes the NPV=0.

  1. Repeat part (e), but first set annual vaccines sold to a value of 100,000. Explain your results.

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