please just answer part b, sensitivity analysis. Can you show how to do the data analysis to get the answers for NPV and base in part b? Please do the Range part also with NPV at different deviations from base

Webmasters.com has developed a powerful new server that would be used for corporations' Internet activities. It would cost $10 million at Year 0 to buy the equipment necessary to manufacture the server. The project would require net working capital at the beginning of each year in an amount equal to 10% of the year's projected sales; for example, NWCo = 10%(Sales). The servers would sell for $24,000 per unit, and Webmasters believes that variable costs would amount to $17,500 per unit. After Year 1, the sales price and variable costs will increase at the inflation rate of 3%. The company's nonvariable costs would be $1 million at Year 1 and would increase with inflation. The server project would have a life of 4 years. If the project is undertaken, it must be continued for the entire 4 years. Also, the project's returns are expected to be highly correlated with returns on the firm's other assets. The firm believes it could sell 1,000 units per year. The equipment would be depreciated over a 5-year period, using MACRS rates. The depreciation rates for a 5. year MACRS asset are: 20%, 32%, 19.20% and 11.52%. The estimated market value of the equipment at the end of the project's 4-year life is $500,000. Webmasters' federal-plus-state tax rate is 40%. Its cost of capital is 10%. 3. a. Develop a spreadsheet model, and use it to find the project's NPV, IRR, and payback. (50 points) a. Develop a spreadsheet model, and use it to find the project's NPV, IRR, and payback. (50 points) Key Results: NPV = $3,463.34 IRR 21.09% Payback 2.8985 Input Data (in thousands of dollars) Equipment cost Net operating working capital/Sales First year sales in units) Sales price per unit Variable cost per unit Nonvariable costs Market value of equipment at Year 4 Tax rate WACC Inflation in prices and costs Estimated salvage value at year 4 $10,000 10% 1,000 $24.00 $17.50 $1,000 $500 40% 10% 3.0% $500 0 Intermediate Calculations Units sold Sales price per unit 1 Variable costs per unit 2 Nonvariable costs 3 Sales revenue 4 Required level of net operating working capital 5. Cash flow due to change in NOWC 6 Basis for depreciation 7 Annual equipment depr. rate 1 1,000 1,000 $24.00 $24.72 $17.50 $18.03 $1,000 $1,030 $24,000.00 $24.720.00 $2,472.00 $2,546.16 (572) (574) 3 4 1,000 1,000 $25.46 $26.23 $18.57 $19.12 $1,060.9 $1,092.73 $25,461.60 $26,225.45 $2,622.54 (576) $2,400.00 ($2,400) $10,000 20.00% 32.00% 19.20% AR 11.52% A Net cash flow Cumulative CF Part of year required for payback $12.400.00 $12.400.00 $4,605 $4,028 $8,372 1.00 $3,767 12 3 4 3 5 $4,193 5425 0.90 57,681 58,106 0.00 1.00 FALSE FALSE 2.9 3.1 b. Now conduct a sensitivity analysis to determine the sensitivity of NPV to changes in the sales price, variable costs per unit, and number of units sold. Set these variables' values at 10% and 20% above and below their base case values. Include a graph in your analysis. ( 15 points for S.A./5 points for graph) Deviation frorn Base Case 20% 10% 0% 10% 20% SALES PRICE Base NPV $24.00 $19.20 $21.60 $24.00 Please lita graph in the yellow box below Deviation from Base Case 20 VARIABLE COST Base NPV $17.50 % Deviation 1st YEAR UNIT SALES from Base NPV Base Case 1,000 $3,463 RAD % Deviation from Base Case 20% -10% 0% 10% 20% SALES PRICE Base NPV $24.00 $19.20 $21.60 $24.00 Please fit a graph in the yellow box below % Deviation from Base Case 20% -10% 0% VARIABLE COST Base NPV $17.50 % Deviation 1st YEAR UNIT SALES from Base NPV Base Case 1,000 $3,463 20% 800 -10% 900 0% 1,000 10% 1,100 20% 1,200 $17.50 10% 20% Deviation NPV at Different Deviations from Base from Sales Variable Base Case Price Cost/Unit Units Sold -20% $0 $0 $0 -10% $0 $0 0% $0 $0 $0 10% $0 $0 $0 20% $0 $0 $0 $0 Range Webmasters.com has developed a powerful new server that would be used for corporations' Internet activities. It would cost $10 million at Year 0 to buy the equipment necessary to manufacture the server. The project would require net working capital at the beginning of each year in an amount equal to 10% of the year's projected sales; for example, NWCo = 10%(Sales). The servers would sell for $24,000 per unit, and Webmasters believes that variable costs would amount to $17,500 per unit. After Year 1, the sales price and variable costs will increase at the inflation rate of 3%. The company's nonvariable costs would be $1 million at Year 1 and would increase with inflation. The server project would have a life of 4 years. If the project is undertaken, it must be continued for the entire 4 years. Also, the project's returns are expected to be highly correlated with returns on the firm's other assets. The firm believes it could sell 1,000 units per year. The equipment would be depreciated over a 5-year period, using MACRS rates. The depreciation rates for a 5. year MACRS asset are: 20%, 32%, 19.20% and 11.52%. The estimated market value of the equipment at the end of the project's 4-year life is $500,000. Webmasters' federal-plus-state tax rate is 40%. Its cost of capital is 10%. 3. a. Develop a spreadsheet model, and use it to find the project's NPV, IRR, and payback. (50 points) a. Develop a spreadsheet model, and use it to find the project's NPV, IRR, and payback. (50 points) Key Results: NPV = $3,463.34 IRR 21.09% Payback 2.8985 Input Data (in thousands of dollars) Equipment cost Net operating working capital/Sales First year sales in units) Sales price per unit Variable cost per unit Nonvariable costs Market value of equipment at Year 4 Tax rate WACC Inflation in prices and costs Estimated salvage value at year 4 $10,000 10% 1,000 $24.00 $17.50 $1,000 $500 40% 10% 3.0% $500 0 Intermediate Calculations Units sold Sales price per unit 1 Variable costs per unit 2 Nonvariable costs 3 Sales revenue 4 Required level of net operating working capital 5. Cash flow due to change in NOWC 6 Basis for depreciation 7 Annual equipment depr. rate 1 1,000 1,000 $24.00 $24.72 $17.50 $18.03 $1,000 $1,030 $24,000.00 $24.720.00 $2,472.00 $2,546.16 (572) (574) 3 4 1,000 1,000 $25.46 $26.23 $18.57 $19.12 $1,060.9 $1,092.73 $25,461.60 $26,225.45 $2,622.54 (576) $2,400.00 ($2,400) $10,000 20.00% 32.00% 19.20% AR 11.52% A Net cash flow Cumulative CF Part of year required for payback $12.400.00 $12.400.00 $4,605 $4,028 $8,372 1.00 $3,767 12 3 4 3 5 $4,193 5425 0.90 57,681 58,106 0.00 1.00 FALSE FALSE 2.9 3.1 b. Now conduct a sensitivity analysis to determine the sensitivity of NPV to changes in the sales price, variable costs per unit, and number of units sold. Set these variables' values at 10% and 20% above and below their base case values. Include a graph in your analysis. ( 15 points for S.A./5 points for graph) Deviation frorn Base Case 20% 10% 0% 10% 20% SALES PRICE Base NPV $24.00 $19.20 $21.60 $24.00 Please lita graph in the yellow box below Deviation from Base Case 20 VARIABLE COST Base NPV $17.50 % Deviation 1st YEAR UNIT SALES from Base NPV Base Case 1,000 $3,463 RAD % Deviation from Base Case 20% -10% 0% 10% 20% SALES PRICE Base NPV $24.00 $19.20 $21.60 $24.00 Please fit a graph in the yellow box below % Deviation from Base Case 20% -10% 0% VARIABLE COST Base NPV $17.50 % Deviation 1st YEAR UNIT SALES from Base NPV Base Case 1,000 $3,463 20% 800 -10% 900 0% 1,000 10% 1,100 20% 1,200 $17.50 10% 20% Deviation NPV at Different Deviations from Base from Sales Variable Base Case Price Cost/Unit Units Sold -20% $0 $0 $0 -10% $0 $0 0% $0 $0 $0 10% $0 $0 $0 20% $0 $0 $0 $0 Range